Home › Forums › Financial Markets/Economics › We’re back…… Using home equity as ATM’s!!!!
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earlyretirement.
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February 11, 2013 at 2:08 AM #759165February 11, 2013 at 3:11 AM #759166
flyer
ParticipantGreat to read all of the interesting comments, and thank you for your thoughts, AN.
My wife and I are extremely grateful for our amazing lives, and, consequently, for the wonderful lives we’ve been able to give our
children–that has been the greatest payoff–seeing our kids achieve their dreams.We rarely compare ourselves to others, because we realize everyone has their own definition of what a “winner” truly is. My ideals are probably far different from another person’s ideals–and that’s a good thing–as long as each is content with his or her choices.
Whether by luck, or any other factor, we feel we’ve been blessed to achieve what we’ve achieved in life and, more importantly, for eternity, and we wish all of the same to others.
February 11, 2013 at 6:38 AM #759167earlyretirement
ParticipantAll great posts since I went to sleep a few hours ago. (wow are some of you night owls… LOL).
Everyone is making excellent points but I agree it’s difficult to compare risk measures from the things we are talking about. I personally don’t even know anyone’s personal situation on this board. I’m speaking in generalities.
It seems like many of you personally know one another’s situations a bit more.
Like flyer mentioned before on another post, we all need to evaluate our own risk.
It is great that so many appreciate being born in the USA. It is SUCH a gift. My kids weren’t born in the USA but they automatically got Citizenship due to my status which I’m grateful for and I’m sure they will be grateful for as well when they are adults.
I do strongly agree with you AN that so many people take their citizenship and luck of being born here in the USA for granted. My family and I certainly aren’t one of them. And like flyer, my father honorably served this country in the military from the very moment he set foot in this country.
February 11, 2013 at 9:23 AM #759174an
ParticipantCAR, where did I ever said it was OK for any of these bailout? Last I check, I gripe about all bailouts, not just pension bailouts. You fail to see that leverage investors are no different than the million of Americans who leverage to buy their home (not for investment). You’re free to judge your friend(s) all you want, but when you make blanket statements like leverage = failure, that’s where I’ve proven that you’re wrong with your broad strokes.
BTW, last I check, the many small business owners who leverage to start their business and fail didn’t get bailed out. So, again, your broad stroke brush is horrible.
By your logic, feel free to vote out all who voted for bail outs, regardless of party line. After all, it’s those in government that voted for the bailouts. Are you willing to do that? I would.
February 11, 2013 at 11:26 AM #759181bearishgurl
Participant[quote=AN] . . . BTW, last I check, the many small business owners who leverage to start their business and fail didn’t get bailed out. So, again, your broad stroke brush is horrible. . . .[/quote]
AN, you need to spend some time in BK court, just to observe. I think it would be enlightening for you. Thousands upon thousands of small biz loans made in this country and “guaranteed” by the “Small Business Administration” (SBA) have defaulted since the inception of the program. Many of the applicants merely had to show a “business plan” to obtain these loans from banks.
I happen to know of a person who applied for (and obtained) one of these loans from a well-known Big Bank. This individual had zero “clients” in said “business” for the four years preceding his application! Of course, the Big Bank didn’t check this info out before handing him the money.
The debtor promptly bought a large boat with the proceeds and then defaulted on the loan after seven months of payments.
When the Big Bank sued and got a default judgement against this individual for the $65K (plus interest and late fees), the judgment debtor promptly put the boat into a relative’s name before they could file a writ of attachment on it.
The Big Bank then filed a lien on his home but they are junior to other creditor’s liens and, in any case, the home (which the debtor rec’d “free and clear” from his deceased father over 30 years ago) is overmortgaged.
This is just ONE “SBA loan.”
Ask yourself who pays for all of this …. :=0
February 11, 2013 at 12:07 PM #759186Participant[quote=bearishgurl][quote=AN] . . . BTW, last I check, the many small business owners who leverage to start their business and fail didn’t get bailed out. So, again, your broad stroke brush is horrible. . . .[/quote]
AN, you need to spend some time in BK court, just to observe. I think it would be enlightening for you. Thousands upon thousands of small biz loans made in this country and “guaranteed” by the “Small Business Administration” (SBA) have defaulted since the inception of the program. Many of the applicants merely had to show a “business plan” to obtain these loans from banks.
I happen to know of a person who applied for (and obtained) one of these loans from a well-known Big Bank. This individual had zero “clients” in said “business” for the four years preceding his application! Of course, the Big Bank didn’t check this info out before handing him the money.
The debtor promptly bought a large boat with the proceeds and then defaulted on the loan after seven months of payments.
When the Big Bank sued and got a default judgement against this individual for the $65K (plus interest and late fees), the judgment debtor promptly put the boat into a relative’s name before they could file a writ of attachment on it.
The Big Bank then filed a lien on his home but they are junior to other creditor’s liens and, in any case, the home (which the debtor rec’d “free and clear” from his deceased father over 30 years ago) is overmortgaged.
This is just ONE “SBA loan.”
Ask yourself who pays for all of this …. :=0[/quote]Not the tax payer. At least nothing like the kind of bail out we saw with the big banks recently. But if your argument is they’re the same, then EVERYONE is being bailed out. So, no point in complaining about bailout since we all will be bailed out.
February 11, 2013 at 12:14 PM #759187Participant[quote=AN][quote=bearishgurl] . . . This is just ONE “SBA loan.”
Ask yourself who pays for all of this …. :=0[/quote]Not the tax payer. At least nothing like the kind of bail out we saw with the big banks recently. But if your argument is they’re the same, then EVERYONE is being bailed out. So, no point in complaining about bailout since we all will be bailed out.[/quote]
Is the SBA not a gubment organization? Who do you think pays to run it and for any “guarantees” it makes on small business loans??
February 11, 2013 at 12:30 PM #759188Participant[quote=bearishgurl][quote=AN][quote=bearishgurl] . . . This is just ONE “SBA loan.”
Ask yourself who pays for all of this …. :=0[/quote]Not the tax payer. At least nothing like the kind of bail out we saw with the big banks recently. But if your argument is they’re the same, then EVERYONE is being bailed out. So, no point in complaining about bailout since we all will be bailed out.[/quote]
Is the SBA not a gubment organization? Who do you think pays to run it and for any “guarantees” it makes on small business loans??
http://www.sba.gov/%5B/quote%5D
Please tell me, did the SBA gave these small businesses more money when they fail so they can keep on operating their business?February 11, 2013 at 12:32 PM #759190Participant[quote=AN][quote=bearishgurl][quote=AN][quote=bearishgurl] . . . This is just ONE “SBA loan.”
Ask yourself who pays for all of this …. :=0[/quote]Not the tax payer. At least nothing like the kind of bail out we saw with the big banks recently. But if your argument is they’re the same, then EVERYONE is being bailed out. So, no point in complaining about bailout since we all will be bailed out.[/quote]
Is the SBA not a gubment organization? Who do you think pays to run it and for any “guarantees” it makes on small business loans??
http://www.sba.gov/%5B/quote%5D
Please tell me, did the SBA gave these small business more money when they fail so they can keep on operating their business?[/quote]In a way, yes. These small businesses don’t necessarily “fail,” but they run out of capital to replace old and/or broken equipment and thus sometimes have to suspend operations because of that. The SBA has programs available to apply for funds to “grow” a business (or restart one that has temporarily been “suspended.”)
In addition, they have programs to prospective new biz owners who only have an idea and a business plan but little else.
In the smaller loans made by the SBA and participating lender (<$100K), there is almost never any collateral given. Just like a student loan, the SBA lenders are relying on the "integrity, wherewithal and talent" of the applicant to be paid back on time and in full.
February 11, 2013 at 12:41 PM #759191Participant[quote=bearishgurl]In a way, yes. These small businesses don’t necessarily “fail,” but they run out of capital to replace old and/or broken equipment and thus sometimes have to suspend operations because of that. The SBA has programs available to apply for funds to “grow” a business (or restart one that has temporarily been “suspended.”)
In addition, they have programs to prospective new biz owners who only have an idea and a business plan but little else.
In the smaller loans made by the SBA and participating lender (<$100K), there is almost never any collateral given. Just like a student loan, the SBA lenders are relying on the "integrity, wherewithal and talent" of the applicant to be paid back on time and in full.[/quote] Uh, if a business run out of cash to operate, then they did fail. When they fail, the SBA didn't give them more money to keep on operating. This is no different than FHA, etc. If you think these are the same as the bail out of big banks a few years back, then I stand by my statement that WE ALL can be bailed out, so quit complaining.
February 11, 2013 at 1:43 PM #759193Participant[quote=AN]Uh, if a business run out of cash to operate, then they did fail. When they fail, the SBA didn’t give them more money to keep on operating. This is no different than FHA, etc. If you think these are the same as the bail out of big banks a few years back, then I stand by my statement that WE ALL can be bailed out, so quit complaining.[/quote]
I’m stating the biz owners who were successful in securing SBA loans to help them continue or get restarted DID get all or part of the money to do so.
With FHA loans, there is collateral given in the form of real property. This is not (usually) so with SBA loans.
You can call SBA loans “bailouts” if you wish. In my mind, they are only “bailouts” if they are non-performing. In any case, they are fully dischargeable in BK proceedings.
You were the one “complaining” here when you stated that small biz owners don’t get “bailed out.”
[quote=AN] . . . BTW, last I check, the many small business owners who leverage to start their business and fail didn’t get bailed out. So, again, your broad stroke brush is horrible. . . .[/quote]
The fact is that many of them DID, courtesy of the Federal gubment.
February 11, 2013 at 2:30 PM #759194Participant[quote=bearishgurl][quote=AN]Uh, if a business run out of cash to operate, then they did fail. When they fail, the SBA didn’t give them more money to keep on operating. This is no different than FHA, etc. If you think these are the same as the bail out of big banks a few years back, then I stand by my statement that WE ALL can be bailed out, so quit complaining.[/quote]
I’m stating the biz owners who were successful in securing SBA loans to help them continue or get restarted DID get all or part of the money to do so.
With FHA loans, there is collateral given in the form of real property. This is not (usually) so with SBA loans.
You can call SBA loans “bailouts” if you wish. In my mind, they are only “bailouts” if they are non-performing. In any case, they are fully dischargeable in BK proceedings.
You were the one “complaining” here when you stated that small biz owners don’t get “bailed out.”
[quote=AN] . . . BTW, last I check, the many small business owners who leverage to start their business and fail didn’t get bailed out. So, again, your broad stroke brush is horrible. . . .[/quote]
The fact is that many of them DID, courtesy of the Federal gubment.[/quote]
Uh, you’re the one that’s calling SBA a bailout. I didn’t and am not. In my eye, they’re similar to FHA, Fanny, Freddy, etc.I didn’t “complain” small biz owners don’t get bail out. I’m stating the fact that they don’t get bail out like the big bank did. What you described is NOTHING like the kind of bailouts the big banks got. Again, do you think SBA will give a second loan to shore up a failed business? Do you think when a small biz file for BK, SBA step in and say, don’t file for BK, here are some more money to turn your companies around?
February 11, 2013 at 6:02 PM #759200CA renter
Participant[quote=AN]CAR, where did I ever said it was OK for any of these bailout? Last I check, I gripe about all bailouts, not just pension bailouts. You fail to see that leverage investors are no different than the million of Americans who leverage to buy their home (not for investment). You’re free to judge your friend(s) all you want, but when you make blanket statements like leverage = failure, that’s where I’ve proven that you’re wrong with your broad strokes.
BTW, last I check, the many small business owners who leverage to start their business and fail didn’t get bailed out. So, again, your broad stroke brush is horrible.
By your logic, feel free to vote out all who voted for bail outs, regardless of party line. After all, it’s those in government that voted for the bailouts. Are you willing to do that? I would.[/quote]
AN, please directly reference the quote where I said that leverage = failure. It doesn’t always lead to failure, but lots of leverage, especially when everybody is leveraging up at the same time to buy assets because people are expecting future price increases, will fail more often than not, IMHO. I’ve said before that self-liquidating debt is fine, and debt that a person can easily pay back is fine, too; but when people are leveraging up to speculate (and then expect everyone else to bail them out later because “nobody could see it coming”), it is not fine.
Also, as someone who is currently fighting the BK of a small business that owes us money, and as a result have spent far too much time listening to BK hearings, I would definitely say that all of us are paying for these deadbeats…and yes, I’m judging many of them. Like BG said, you ought to sit in on these hearings so that you can get a better understanding of how people got into debt, and how the creditors (and the customers of the institutional creditors, and taxpayers who are bailing out these institutions, too) are bailing out all of these deadbeats. Go to the hearings, and you’ll see it’s even worse than you would ever imagine. And the bar for declaring BK is way too low, IMHO. It’s sickening.
February 11, 2013 at 9:12 PM #759204Participant[quote=CA renter]AN, please directly reference the quote where I said that leverage = failure.[/quote]http://piggington.com/over_21_of_homeowners_in_sd_county_have_paid_off_houses?page=1. You said [quote=CA renter]but that is different from leveraging up to buy multiple properties, stocks, futures contracts, or getting into “partnerships” or investing with fast-talking salespeople, etc. which is a recipe for failure more often than not, IMHO.[/quote] I was short handing leverage = failure, they’re not your exact words.
[quote=CA renter] It doesn’t always lead to failure, but lots of leverage, especially when everybody is leveraging up at the same time to buy assets because people are expecting future price increases, will fail more often than not, IMHO. I’ve said before that self-liquidating debt is fine, and debt that a person can easily pay back is fine, too; but when people are leveraging up to speculate (and then expect everyone else to bail them out later because “nobody could see it coming”), it is not fine.[/quote]I agree with this, but this is no different than the vast majority who lives pay check to pay check and use their credit cards to finance their consumption.
[quote=CA renter]Also, as someone who is currently fighting the BK of a small business that owes us money, and as a result have spent far too much time listening to BK hearings, I would definitely say that all of us are paying for these deadbeats…and yes, I’m judging many of them. Like BG said, you ought to sit in on these hearings so that you can get a better understanding of how people got into debt, and how the creditors (and the customers of the institutional creditors, and taxpayers who are bailing out these institutions, too) are bailing out all of these deadbeats. Go to the hearings, and you’ll see it’s even worse than you would ever imagine. And the bar for declaring BK is way too low, IMHO. It’s sickening.[/quote]It sounded like you took the calculated risk to be a lender and failed. There’s nothing wrong with failing. You get up and try again. We’ve all have our failures.
February 11, 2013 at 10:38 PM #759207Participant[quote=AN]I agree with this, but this is no different than the vast majority who lives pay check to pay check and use their credit cards to finance their consumption.
[/quote]
Speaking of credit cards. I was reading my Wall Street Journal today and smirked when I read of retail investors using credit cards to “invest”.
Page C3 with the article titled, “Small Traders In Currencies Face Card Ban”.
The part I read with interest was, “The National Futures Association, the self-regulating group for the U.S. futures industry, in a January 18 letter to members, said it is concerned retail customers ‘are using credit cards as a source for borrowing funds to invest’. ”
I think years down the road we’re going to see and read about more and more people that are using credit cards and cash advance checks from credit cards to “invest” in their margin accounts. We will probably read how these people got crushed and never could pay their credit cards back. And probably will be writing these credit cards off and default.
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