intentional overextension

[(former)FormerSanDiegan]

If you have avoided the whole bubble so far and have not bought yet, the housing market has given you a once or twice per lieftime opportunity. The strategy outlined in the original post would squander this gift.

[davelj]

[quote=patientrenter]I was raised to never do something like that, scaredycat, but the total unfairness of the massive bailouts has made a dent in my moral compass. Now if I saw a chance to pocket a few hundred thousand (in value) by drinking from the same trough, I would. I pay hundreds of thousands in taxes every year, so I am going to be paying for all the feeding anyway.
[/quote]

If you pay “hundreds of thousands in taxes every year” then, by definition, you make at least $500K per year. So, a couple of observations/questions follow. First, if you’re making that kind of money, is another “few hundred thousand dollars” really worth the hassle (I presume you’ve saved up a good bit of this money over the years)? Second, any job in which you’re making that kind of dough probably involves something in which filing bankruptcy and/or defaulting on a mortgage would be highly embarrassing (it’s public information) and potentially harmful to your career. Again, is your reputation worth “a few hundred thousand dollars”? I certainly hope not.

Personally, such actions would do irreparable harm to my career. I sit on two bank boards, manage two private equity partnerships, and do a lot of financial consulting. Hell, I’ve had clients ask to run a credit check on me prior to engaging me or investing in my partnerships. For all intents and purposes, I can’t operate with a FICO under 750 – too many questions would be raised. So, the amount of money for which I’d be willing to ruin my reputation is high. Quite high. And many, many, many, MANY multiples of a few hundred thousand dollars.

So, if you’re making over $500K/year I’ve gotta believe that you’re in the same boat – or at least sailing in a similar body of water. Forgetting about the ethical issues, I just can’t see how a few hundred grand is worth the hassle, embarrassment, and potential career risk. It just doesn’t add up.

[davelj]

[quote=patientrenter]I was raised to never do something like that, scaredycat, but the total unfairness of the massive bailouts has made a dent in my moral compass. Now if I saw a chance to pocket a few hundred thousand (in value) by drinking from the same trough, I would. I pay hundreds of thousands in taxes every year, so I am going to be paying for all the feeding anyway.
[/quote]

If you pay “hundreds of thousands in taxes every year” then, by definition, you make at least $500K per year. So, a couple of observations/questions follow. First, if you’re making that kind of money, is another “few hundred thousand dollars” really worth the hassle (I presume you’ve saved up a good bit of this money over the years)? Second, any job in which you’re making that kind of dough probably involves something in which filing bankruptcy and/or defaulting on a mortgage would be highly embarrassing (it’s public information) and potentially harmful to your career. Again, is your reputation worth “a few hundred thousand dollars”? I certainly hope not.

Personally, such actions would do irreparable harm to my career. I sit on two bank boards, manage two private equity partnerships, and do a lot of financial consulting. Hell, I’ve had clients ask to run a credit check on me prior to engaging me or investing in my partnerships. For all intents and purposes, I can’t operate with a FICO under 750 – too many questions would be raised. So, the amount of money for which I’d be willing to ruin my reputation is high. Quite high. And many, many, many, MANY multiples of a few hundred thousand dollars.

So, if you’re making over $500K/year I’ve gotta believe that you’re in the same boat – or at least sailing in a similar body of water. Forgetting about the ethical issues, I just can’t see how a few hundred grand is worth the hassle, embarrassment, and potential career risk. It just doesn’t add up.

[davelj]

[quote=patientrenter]I was raised to never do something like that, scaredycat, but the total unfairness of the massive bailouts has made a dent in my moral compass. Now if I saw a chance to pocket a few hundred thousand (in value) by drinking from the same trough, I would. I pay hundreds of thousands in taxes every year, so I am going to be paying for all the feeding anyway.
[/quote]

If you pay “hundreds of thousands in taxes every year” then, by definition, you make at least $500K per year. So, a couple of observations/questions follow. First, if you’re making that kind of money, is another “few hundred thousand dollars” really worth the hassle (I presume you’ve saved up a good bit of this money over the years)? Second, any job in which you’re making that kind of dough probably involves something in which filing bankruptcy and/or defaulting on a mortgage would be highly embarrassing (it’s public information) and potentially harmful to your career. Again, is your reputation worth “a few hundred thousand dollars”? I certainly hope not.

Personally, such actions would do irreparable harm to my career. I sit on two bank boards, manage two private equity partnerships, and do a lot of financial consulting. Hell, I’ve had clients ask to run a credit check on me prior to engaging me or investing in my partnerships. For all intents and purposes, I can’t operate with a FICO under 750 – too many questions would be raised. So, the amount of money for which I’d be willing to ruin my reputation is high. Quite high. And many, many, many, MANY multiples of a few hundred thousand dollars.

So, if you’re making over $500K/year I’ve gotta believe that you’re in the same boat – or at least sailing in a similar body of water. Forgetting about the ethical issues, I just can’t see how a few hundred grand is worth the hassle, embarrassment, and potential career risk. It just doesn’t add up.

[davelj]

[quote=patientrenter]I was raised to never do something like that, scaredycat, but the total unfairness of the massive bailouts has made a dent in my moral compass. Now if I saw a chance to pocket a few hundred thousand (in value) by drinking from the same trough, I would. I pay hundreds of thousands in taxes every year, so I am going to be paying for all the feeding anyway.
[/quote]

If you pay “hundreds of thousands in taxes every year” then, by definition, you make at least $500K per year. So, a couple of observations/questions follow. First, if you’re making that kind of money, is another “few hundred thousand dollars” really worth the hassle (I presume you’ve saved up a good bit of this money over the years)? Second, any job in which you’re making that kind of dough probably involves something in which filing bankruptcy and/or defaulting on a mortgage would be highly embarrassing (it’s public information) and potentially harmful to your career. Again, is your reputation worth “a few hundred thousand dollars”? I certainly hope not.

Personally, such actions would do irreparable harm to my career. I sit on two bank boards, manage two private equity partnerships, and do a lot of financial consulting. Hell, I’ve had clients ask to run a credit check on me prior to engaging me or investing in my partnerships. For all intents and purposes, I can’t operate with a FICO under 750 – too many questions would be raised. So, the amount of money for which I’d be willing to ruin my reputation is high. Quite high. And many, many, many, MANY multiples of a few hundred thousand dollars.

So, if you’re making over $500K/year I’ve gotta believe that you’re in the same boat – or at least sailing in a similar body of water. Forgetting about the ethical issues, I just can’t see how a few hundred grand is worth the hassle, embarrassment, and potential career risk. It just doesn’t add up.

[davelj]

[quote=patientrenter]I was raised to never do something like that, scaredycat, but the total unfairness of the massive bailouts has made a dent in my moral compass. Now if I saw a chance to pocket a few hundred thousand (in value) by drinking from the same trough, I would. I pay hundreds of thousands in taxes every year, so I am going to be paying for all the feeding anyway.
[/quote]

If you pay “hundreds of thousands in taxes every year” then, by definition, you make at least $500K per year. So, a couple of observations/questions follow. First, if you’re making that kind of money, is another “few hundred thousand dollars” really worth the hassle (I presume you’ve saved up a good bit of this money over the years)? Second, any job in which you’re making that kind of dough probably involves something in which filing bankruptcy and/or defaulting on a mortgage would be highly embarrassing (it’s public information) and potentially harmful to your career. Again, is your reputation worth “a few hundred thousand dollars”? I certainly hope not.

Personally, such actions would do irreparable harm to my career. I sit on two bank boards, manage two private equity partnerships, and do a lot of financial consulting. Hell, I’ve had clients ask to run a credit check on me prior to engaging me or investing in my partnerships. For all intents and purposes, I can’t operate with a FICO under 750 – too many questions would be raised. So, the amount of money for which I’d be willing to ruin my reputation is high. Quite high. And many, many, many, MANY multiples of a few hundred thousand dollars.

So, if you’re making over $500K/year I’ve gotta believe that you’re in the same boat – or at least sailing in a similar body of water. Forgetting about the ethical issues, I just can’t see how a few hundred grand is worth the hassle, embarrassment, and potential career risk. It just doesn’t add up.

[Coronita]

[quote=briansd1][quote=flu_aka_idiot_saver]

Also, how much is your credit worth? If you don’t work at a defense job, it probably doesn’t matter as much.
[/quote]

I know someone with security clearance who has walked on 2 “investment” properties. No big deal.
[/quote]

Was the walking part before or after he got his security clearance? It’s a serious question…I knew folks that were turned down from being able to work in sensitive datacenters which had access to customer’s SSN#

[Coronita]

[quote=briansd1][quote=flu_aka_idiot_saver]

Also, how much is your credit worth? If you don’t work at a defense job, it probably doesn’t matter as much.
[/quote]

I know someone with security clearance who has walked on 2 “investment” properties. No big deal.
[/quote]

Was the walking part before or after he got his security clearance? It’s a serious question…I knew folks that were turned down from being able to work in sensitive datacenters which had access to customer’s SSN#

[Coronita]

[quote=briansd1][quote=flu_aka_idiot_saver]

Also, how much is your credit worth? If you don’t work at a defense job, it probably doesn’t matter as much.
[/quote]

I know someone with security clearance who has walked on 2 “investment” properties. No big deal.
[/quote]

Was the walking part before or after he got his security clearance? It’s a serious question…I knew folks that were turned down from being able to work in sensitive datacenters which had access to customer’s SSN#

[Coronita]

[quote=briansd1][quote=flu_aka_idiot_saver]

Also, how much is your credit worth? If you don’t work at a defense job, it probably doesn’t matter as much.
[/quote]

I know someone with security clearance who has walked on 2 “investment” properties. No big deal.
[/quote]

Was the walking part before or after he got his security clearance? It’s a serious question…I knew folks that were turned down from being able to work in sensitive datacenters which had access to customer’s SSN#

[Coronita]

[quote=briansd1][quote=flu_aka_idiot_saver]

Also, how much is your credit worth? If you don’t work at a defense job, it probably doesn’t matter as much.
[/quote]

I know someone with security clearance who has walked on 2 “investment” properties. No big deal.
[/quote]

Was the walking part before or after he got his security clearance? It’s a serious question…I knew folks that were turned down from being able to work in sensitive datacenters which had access to customer’s SSN#

[patientrenter]

Well, my personal situation is a bit different, davelj, so maybe I should explain.

I value each few hundred thousand of savings because I am very conservative. For example, I like to limit my spending to less than 10% of my income. My cash reserves cover 10 years of spending, and that’s a low point for me. I have never borrowed, and I have never looked up my credit score, so I don’t know what it is. But I am aware that, since I don’t pay any attention to it, it might be low. (If FedEx screws up a billing, I politely let them know. If they screw it up twice, I just don’t pay. I don’t have time to waste.) When I last moved jobs, I actually required that the offer not be conditional on my credit score. I am well known in my little segment of my industry, so it was not a problem.

I can’t imagine a bad credit score becoming an issue for me, since I don’t have a high (general) public profile at the companies I work for. (They are well-known financial institutions.) I do have to file detailed background information about myself directly with dozens of regulatory bodies, but they don’t ask for my credit score. And the people who know me at my company use me for valuing acquisition targets, so I think they just don’t much care if FedEx disagrees with me on a bill. If I ever had to take on more public responsibilities, I’d just clean up the credit score.

I am curious, what forces you to have a good credit score? Is it reputational – the folks you deal as clients don’t know you that well? Or is it regulatory – bank regulators require it of directors? I may have to pay attention to my score one day, I suppose, so it probably wouldn’t hurt to become aware of what other folks have to do.

[patientrenter]

Well, my personal situation is a bit different, davelj, so maybe I should explain.

I value each few hundred thousand of savings because I am very conservative. For example, I like to limit my spending to less than 10% of my income. My cash reserves cover 10 years of spending, and that’s a low point for me. I have never borrowed, and I have never looked up my credit score, so I don’t know what it is. But I am aware that, since I don’t pay any attention to it, it might be low. (If FedEx screws up a billing, I politely let them know. If they screw it up twice, I just don’t pay. I don’t have time to waste.) When I last moved jobs, I actually required that the offer not be conditional on my credit score. I am well known in my little segment of my industry, so it was not a problem.

I can’t imagine a bad credit score becoming an issue for me, since I don’t have a high (general) public profile at the companies I work for. (They are well-known financial institutions.) I do have to file detailed background information about myself directly with dozens of regulatory bodies, but they don’t ask for my credit score. And the people who know me at my company use me for valuing acquisition targets, so I think they just don’t much care if FedEx disagrees with me on a bill. If I ever had to take on more public responsibilities, I’d just clean up the credit score.

I am curious, what forces you to have a good credit score? Is it reputational – the folks you deal as clients don’t know you that well? Or is it regulatory – bank regulators require it of directors? I may have to pay attention to my score one day, I suppose, so it probably wouldn’t hurt to become aware of what other folks have to do.

[patientrenter]

Well, my personal situation is a bit different, davelj, so maybe I should explain.

I value each few hundred thousand of savings because I am very conservative. For example, I like to limit my spending to less than 10% of my income. My cash reserves cover 10 years of spending, and that’s a low point for me. I have never borrowed, and I have never looked up my credit score, so I don’t know what it is. But I am aware that, since I don’t pay any attention to it, it might be low. (If FedEx screws up a billing, I politely let them know. If they screw it up twice, I just don’t pay. I don’t have time to waste.) When I last moved jobs, I actually required that the offer not be conditional on my credit score. I am well known in my little segment of my industry, so it was not a problem.

I can’t imagine a bad credit score becoming an issue for me, since I don’t have a high (general) public profile at the companies I work for. (They are well-known financial institutions.) I do have to file detailed background information about myself directly with dozens of regulatory bodies, but they don’t ask for my credit score. And the people who know me at my company use me for valuing acquisition targets, so I think they just don’t much care if FedEx disagrees with me on a bill. If I ever had to take on more public responsibilities, I’d just clean up the credit score.

I am curious, what forces you to have a good credit score? Is it reputational – the folks you deal as clients don’t know you that well? Or is it regulatory – bank regulators require it of directors? I may have to pay attention to my score one day, I suppose, so it probably wouldn’t hurt to become aware of what other folks have to do.

[patientrenter]

Well, my personal situation is a bit different, davelj, so maybe I should explain.

I value each few hundred thousand of savings because I am very conservative. For example, I like to limit my spending to less than 10% of my income. My cash reserves cover 10 years of spending, and that’s a low point for me. I have never borrowed, and I have never looked up my credit score, so I don’t know what it is. But I am aware that, since I don’t pay any attention to it, it might be low. (If FedEx screws up a billing, I politely let them know. If they screw it up twice, I just don’t pay. I don’t have time to waste.) When I last moved jobs, I actually required that the offer not be conditional on my credit score. I am well known in my little segment of my industry, so it was not a problem.

I can’t imagine a bad credit score becoming an issue for me, since I don’t have a high (general) public profile at the companies I work for. (They are well-known financial institutions.) I do have to file detailed background information about myself directly with dozens of regulatory bodies, but they don’t ask for my credit score. And the people who know me at my company use me for valuing acquisition targets, so I think they just don’t much care if FedEx disagrees with me on a bill. If I ever had to take on more public responsibilities, I’d just clean up the credit score.

I am curious, what forces you to have a good credit score? Is it reputational – the folks you deal as clients don’t know you that well? Or is it regulatory – bank regulators require it of directors? I may have to pay attention to my score one day, I suppose, so it probably wouldn’t hurt to become aware of what other folks have to do.

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