My Personal Credit Crisis

[Anonymous]

I first read the original article late at night off of the NYT website. We all view things differently and my response to the article was, frankly, that it moved me to tears.

What I saw and felt was the pain that a father feels when he faces not being able to provide for his family through the consequences of some mis-steps and errors in judgement. Can you imagine how it must anguish his soul that no clear resolution appears on the horizon?

It is a sad, sad situation – no one appears to have been watching out for his fellow man on this one. He was blinded, but no more so than Fannie Mae and Freddie Mac, Wall Street, the real estate agents, the loan agent, the securitizers, the ratings agencies nor the regulators. I can not bring myself to condemn this man – I can only extend compassion and my prayers.

[jpinpb]

[quote=ucodegen]

“Don’t worry,” Bob reassured me, saying what almost everybody else in real estate was saying at that moment. “The value of your house will be higher in five years. You’ll be able to refinance.”

Several people fell for this red herring.. even some people that I know. Refinance to what? A greater debt load than you already have.. and that you are already having problems with?
[/quote]

So true. I remember a lender telling us that exactly. I was livid. I had an argument later after we left about if the market even comes down only 5% on a half million dollar house (about median back then) we will have to come up with 25k to make up the loss in order to refinance.

And I admittedly suck at math, but how can anyone realistically think this bubble was going to go on forever. I just would not have been able to sleep at night if we bought. I would have been on pins and needles waiting for the bottom to fall out.

I just have a hard time having sympathy. I mean, maybe if you’re fresh out of school, just started working, wet behind the ears and on the very naieve side, then I can see it. You know nothing about real estate and you relied on “professionals,” then you got suckered.

I am no expert. This was just a no-brainer. Income and pricing were grossly misaligned. The prices kept going up and all I kept saying is “How can they afford it? How are they doing it?”

And well, that answer is obvious now. They couldn’t afford it and it was all smoke and mirrors and borrowed and borrowed again.

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out.

[jpinpb]

[quote=ucodegen]

“Don’t worry,” Bob reassured me, saying what almost everybody else in real estate was saying at that moment. “The value of your house will be higher in five years. You’ll be able to refinance.”

Several people fell for this red herring.. even some people that I know. Refinance to what? A greater debt load than you already have.. and that you are already having problems with?
[/quote]

So true. I remember a lender telling us that exactly. I was livid. I had an argument later after we left about if the market even comes down only 5% on a half million dollar house (about median back then) we will have to come up with 25k to make up the loss in order to refinance.

And I admittedly suck at math, but how can anyone realistically think this bubble was going to go on forever. I just would not have been able to sleep at night if we bought. I would have been on pins and needles waiting for the bottom to fall out.

I just have a hard time having sympathy. I mean, maybe if you’re fresh out of school, just started working, wet behind the ears and on the very naieve side, then I can see it. You know nothing about real estate and you relied on “professionals,” then you got suckered.

I am no expert. This was just a no-brainer. Income and pricing were grossly misaligned. The prices kept going up and all I kept saying is “How can they afford it? How are they doing it?”

And well, that answer is obvious now. They couldn’t afford it and it was all smoke and mirrors and borrowed and borrowed again.

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out.

[jpinpb]

[quote=ucodegen]

“Don’t worry,” Bob reassured me, saying what almost everybody else in real estate was saying at that moment. “The value of your house will be higher in five years. You’ll be able to refinance.”

Several people fell for this red herring.. even some people that I know. Refinance to what? A greater debt load than you already have.. and that you are already having problems with?
[/quote]

So true. I remember a lender telling us that exactly. I was livid. I had an argument later after we left about if the market even comes down only 5% on a half million dollar house (about median back then) we will have to come up with 25k to make up the loss in order to refinance.

And I admittedly suck at math, but how can anyone realistically think this bubble was going to go on forever. I just would not have been able to sleep at night if we bought. I would have been on pins and needles waiting for the bottom to fall out.

I just have a hard time having sympathy. I mean, maybe if you’re fresh out of school, just started working, wet behind the ears and on the very naieve side, then I can see it. You know nothing about real estate and you relied on “professionals,” then you got suckered.

I am no expert. This was just a no-brainer. Income and pricing were grossly misaligned. The prices kept going up and all I kept saying is “How can they afford it? How are they doing it?”

And well, that answer is obvious now. They couldn’t afford it and it was all smoke and mirrors and borrowed and borrowed again.

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out.

[jpinpb]

[quote=ucodegen]

“Don’t worry,” Bob reassured me, saying what almost everybody else in real estate was saying at that moment. “The value of your house will be higher in five years. You’ll be able to refinance.”

Several people fell for this red herring.. even some people that I know. Refinance to what? A greater debt load than you already have.. and that you are already having problems with?
[/quote]

So true. I remember a lender telling us that exactly. I was livid. I had an argument later after we left about if the market even comes down only 5% on a half million dollar house (about median back then) we will have to come up with 25k to make up the loss in order to refinance.

And I admittedly suck at math, but how can anyone realistically think this bubble was going to go on forever. I just would not have been able to sleep at night if we bought. I would have been on pins and needles waiting for the bottom to fall out.

I just have a hard time having sympathy. I mean, maybe if you’re fresh out of school, just started working, wet behind the ears and on the very naieve side, then I can see it. You know nothing about real estate and you relied on “professionals,” then you got suckered.

I am no expert. This was just a no-brainer. Income and pricing were grossly misaligned. The prices kept going up and all I kept saying is “How can they afford it? How are they doing it?”

And well, that answer is obvious now. They couldn’t afford it and it was all smoke and mirrors and borrowed and borrowed again.

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out.

[jpinpb]

[quote=ucodegen]

“Don’t worry,” Bob reassured me, saying what almost everybody else in real estate was saying at that moment. “The value of your house will be higher in five years. You’ll be able to refinance.”

Several people fell for this red herring.. even some people that I know. Refinance to what? A greater debt load than you already have.. and that you are already having problems with?
[/quote]

So true. I remember a lender telling us that exactly. I was livid. I had an argument later after we left about if the market even comes down only 5% on a half million dollar house (about median back then) we will have to come up with 25k to make up the loss in order to refinance.

And I admittedly suck at math, but how can anyone realistically think this bubble was going to go on forever. I just would not have been able to sleep at night if we bought. I would have been on pins and needles waiting for the bottom to fall out.

I just have a hard time having sympathy. I mean, maybe if you’re fresh out of school, just started working, wet behind the ears and on the very naieve side, then I can see it. You know nothing about real estate and you relied on “professionals,” then you got suckered.

I am no expert. This was just a no-brainer. Income and pricing were grossly misaligned. The prices kept going up and all I kept saying is “How can they afford it? How are they doing it?”

And well, that answer is obvious now. They couldn’t afford it and it was all smoke and mirrors and borrowed and borrowed again.

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out.

[davelj]

[quote=jpinpb]

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out. [/quote]

It’s pretty simple… Hope springs eternal.

Humans are optimists by nature. It’s ingrained in our DNA. Otherwise, we never would have survived the brutal conditions that we faced early in our development. It’s what enables us to take risks, and risk-taking is at the heart of raising our standard of living.

The problem is that, at times – like now – this optimism goes haywire. And here we are.

But this too shall pass.

[davelj]

[quote=jpinpb]

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out. [/quote]

It’s pretty simple… Hope springs eternal.

Humans are optimists by nature. It’s ingrained in our DNA. Otherwise, we never would have survived the brutal conditions that we faced early in our development. It’s what enables us to take risks, and risk-taking is at the heart of raising our standard of living.

The problem is that, at times – like now – this optimism goes haywire. And here we are.

But this too shall pass.

[davelj]

[quote=jpinpb]

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out. [/quote]

It’s pretty simple… Hope springs eternal.

Humans are optimists by nature. It’s ingrained in our DNA. Otherwise, we never would have survived the brutal conditions that we faced early in our development. It’s what enables us to take risks, and risk-taking is at the heart of raising our standard of living.

The problem is that, at times – like now – this optimism goes haywire. And here we are.

But this too shall pass.

[davelj]

[quote=jpinpb]

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out. [/quote]

It’s pretty simple… Hope springs eternal.

Humans are optimists by nature. It’s ingrained in our DNA. Otherwise, we never would have survived the brutal conditions that we faced early in our development. It’s what enables us to take risks, and risk-taking is at the heart of raising our standard of living.

The problem is that, at times – like now – this optimism goes haywire. And here we are.

But this too shall pass.

[davelj]

[quote=jpinpb]

Anyone that bought should have asked that question. Don’t people know how much they make and how much they spend? This is basic math. I think most kids in elementary school can figure this out. [/quote]

It’s pretty simple… Hope springs eternal.

Humans are optimists by nature. It’s ingrained in our DNA. Otherwise, we never would have survived the brutal conditions that we faced early in our development. It’s what enables us to take risks, and risk-taking is at the heart of raising our standard of living.

The problem is that, at times – like now – this optimism goes haywire. And here we are.

But this too shall pass.

[scaredyclassic]

not all humans are optimists by nature. there’s a range. In fact, large swaths of us are whatare called “defensive pessimists”. we plan for the wrost and expect it as a probably outcome and plan for it. Optimism is not what allows people to take risks; optimism is what allows people to take dumb risks. Low expectations in life are the secret to happiness.

[scaredyclassic]

not all humans are optimists by nature. there’s a range. In fact, large swaths of us are whatare called “defensive pessimists”. we plan for the wrost and expect it as a probably outcome and plan for it. Optimism is not what allows people to take risks; optimism is what allows people to take dumb risks. Low expectations in life are the secret to happiness.

[scaredyclassic]

not all humans are optimists by nature. there’s a range. In fact, large swaths of us are whatare called “defensive pessimists”. we plan for the wrost and expect it as a probably outcome and plan for it. Optimism is not what allows people to take risks; optimism is what allows people to take dumb risks. Low expectations in life are the secret to happiness.

[scaredyclassic]

not all humans are optimists by nature. there’s a range. In fact, large swaths of us are whatare called “defensive pessimists”. we plan for the wrost and expect it as a probably outcome and plan for it. Optimism is not what allows people to take risks; optimism is what allows people to take dumb risks. Low expectations in life are the secret to happiness.

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