Viral Nature of Walking Away

[jpinpb]

[quote=eavesdropper]
Aside from clear-cut cases of predatory lending, most people should have known that they couldn’t afford an $850,000 house on a $70,000 household income. [/quote]

While the blame for all this can be spread all over the place (mostly greed on everyone’s part) I have to say that it boils down to basic math for people buying a house. There just is no excuse. Everyone knows basic math and either you have the money or you don’t. Most people just ignored it, thinking prices would keep going up and they can flip. For those who bought and ran the numbers and made sense, but lost their jobs, that’s a genuine reason for not paying.

As for your stepdaughter, at least she has her whole life ahead of her. Maybe she can recover from it. It must be frustrating to share your knowledge and to be ignored and come back w/the irrational exuberance of how much will it rise in a couple of years. Sometimes people have to fall down and experience it on their own. Very hard to stand by and let that happen. Natural instinct is to help. Just don’t hurt yourself in the process. Continually helping puts you in the enabler position.

[briansd1]

[quote=eavesdropper] That being said, I do agree that the mortgage bankers themselves knew exactly what was going on, and wanted to exploit it. I was referring to being ethically and morally blinded by the money to be made by following that path. And it was too bad that the general public was still so trusting of their image of financial stewards (the wonders of advertising didn’t hurt there).[/quote]

Of course the bankers knew, at least on a theoretical level.

During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?

[briansd1]

[quote=eavesdropper] That being said, I do agree that the mortgage bankers themselves knew exactly what was going on, and wanted to exploit it. I was referring to being ethically and morally blinded by the money to be made by following that path. And it was too bad that the general public was still so trusting of their image of financial stewards (the wonders of advertising didn’t hurt there).[/quote]

Of course the bankers knew, at least on a theoretical level.

During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?

[briansd1]

[quote=eavesdropper] That being said, I do agree that the mortgage bankers themselves knew exactly what was going on, and wanted to exploit it. I was referring to being ethically and morally blinded by the money to be made by following that path. And it was too bad that the general public was still so trusting of their image of financial stewards (the wonders of advertising didn’t hurt there).[/quote]

Of course the bankers knew, at least on a theoretical level.

During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?

[briansd1]

[quote=eavesdropper] That being said, I do agree that the mortgage bankers themselves knew exactly what was going on, and wanted to exploit it. I was referring to being ethically and morally blinded by the money to be made by following that path. And it was too bad that the general public was still so trusting of their image of financial stewards (the wonders of advertising didn’t hurt there).[/quote]

Of course the bankers knew, at least on a theoretical level.

During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?

[briansd1]

[quote=eavesdropper] That being said, I do agree that the mortgage bankers themselves knew exactly what was going on, and wanted to exploit it. I was referring to being ethically and morally blinded by the money to be made by following that path. And it was too bad that the general public was still so trusting of their image of financial stewards (the wonders of advertising didn’t hurt there).[/quote]

Of course the bankers knew, at least on a theoretical level.

During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?

[UCGal]

[quote=briansd1]
During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?[/quote]

I think we can all agree that the housing implosion was not “contained” to the subprime loans. I’ve seen quite a few short sales and foreclosures where the purchase loan or refi loan was not sub prime or even alt-A.

[UCGal]

[quote=briansd1]
During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?[/quote]

I think we can all agree that the housing implosion was not “contained” to the subprime loans. I’ve seen quite a few short sales and foreclosures where the purchase loan or refi loan was not sub prime or even alt-A.

[UCGal]

[quote=briansd1]
During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?[/quote]

I think we can all agree that the housing implosion was not “contained” to the subprime loans. I’ve seen quite a few short sales and foreclosures where the purchase loan or refi loan was not sub prime or even alt-A.

[UCGal]

[quote=briansd1]
During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?[/quote]

I think we can all agree that the housing implosion was not “contained” to the subprime loans. I’ve seen quite a few short sales and foreclosures where the purchase loan or refi loan was not sub prime or even alt-A.

[UCGal]

[quote=briansd1]
During the boom everyone was making money… but academically speaking, when the riskiest, most sophisticated mortgage products (toxic mortgages) were being sold to the poorest and least educated people (sub-prime) then what did they expect?[/quote]

I think we can all agree that the housing implosion was not “contained” to the subprime loans. I’ve seen quite a few short sales and foreclosures where the purchase loan or refi loan was not sub prime or even alt-A.

[briansd1]

You’re correct UCGal.

But generally, the riskiest, most sophisticated products (pick a pay, initial teaser rates, etc..) were sold to the lowest income, least educated people who fronted the lowest down-payments.

Any reasonable manager would expect high future default rates.

The bankers were blinded by the immediate money to be made and didn’t worry about the future. Regulators enabled and encouraged this lopsided underwriting model.

[briansd1]

You’re correct UCGal.

But generally, the riskiest, most sophisticated products (pick a pay, initial teaser rates, etc..) were sold to the lowest income, least educated people who fronted the lowest down-payments.

Any reasonable manager would expect high future default rates.

The bankers were blinded by the immediate money to be made and didn’t worry about the future. Regulators enabled and encouraged this lopsided underwriting model.

[briansd1]

You’re correct UCGal.

But generally, the riskiest, most sophisticated products (pick a pay, initial teaser rates, etc..) were sold to the lowest income, least educated people who fronted the lowest down-payments.

Any reasonable manager would expect high future default rates.

The bankers were blinded by the immediate money to be made and didn’t worry about the future. Regulators enabled and encouraged this lopsided underwriting model.

[briansd1]

You’re correct UCGal.

But generally, the riskiest, most sophisticated products (pick a pay, initial teaser rates, etc..) were sold to the lowest income, least educated people who fronted the lowest down-payments.

Any reasonable manager would expect high future default rates.

The bankers were blinded by the immediate money to be made and didn’t worry about the future. Regulators enabled and encouraged this lopsided underwriting model.

[Author]

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