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February 20, 2013 at 11:24 AM in reply to: Why American is failing to prepare for their retirement? #759852February 20, 2013 at 9:12 AM in reply to: Why American is failing to prepare for their retirement? #759848
livinincali
Participant[quote=earlyretirement]
I do see the biggest problem with the X & Y group that is over leveraged and seem to spend as much as they make and have no or negative net worth. I’m not sure what the future holds for these type of people.I’m not so sure however that all the Boomers are in as good of a situation as you and your friends.[/quote]
Better hope the X&Y groups are better off than you think because these are the people you’re going to need to sell or rent your assets to in order to fund retirement. When you make an investment it pays to think about the person who you think you could sell it to for more in the future. Some assets will do better than others but if the next generation is going to be over burdened you might want to rethink how much your assets are really going to be worth in the future. I suppose you could hope for rich Chinese buyers.
Participant[quote=AN][quote=davidaaronhart]We actually have checked it out. the challenge is we need to keep the amount borrowed under $417k since once you go above it is considered a jumbo. Going over requires 10% down to avoid having to go with an FHA loan. the PMI would kill us with an FHA. we would be able to 5% for anything under $417 borrowed. basically it would put us right at the top of our price range depending on taxes and if there is an HOA for the property. I am estimating about 3k/mo. for the overall cost.[/quote]
Assuming $410k, your P+I would be ~$1800. Your PITI would be $2300/month. Most places in Mira Mesa doesn’t have HOA. Those that do are more expensive or are on the east side of MM. HOA in MM are no more than $50/month. Working in Sorrento, your gas cost would go down drastically, not to mention having an option to bike to work. There’s also a new Elementary school that’s being built in the South West part of Mira Mesa if that matters to you. I don’t know your tax bracket but before any deduction, we’re talking about at most $2400/month. That’s far from the $3k/month you’re estimating.[/quote]For an FHA loan you have to add in the 1.25 purchase price Mortgage Insurance Premium which amounts to another $400/mo for a $410K loan. Still less than $3000/mo but awfully close.
Participant[quote=bearishgurl]
I just don’t see how it’s possible for a lender to “police” what a borrower does with his/her HELOC proceeds.
[/quote]I personally don’t think lenders should police what you do with the money. I do think the lenders should establish the interest rate at a level that corresponds with the risk. Of course when you have the tax payers to bail you out risk pricing goes out the window.
The problem with lending these days is nobody bothers to price the risk anymore. Everyone expects the tax payer bailout. If you actually made the lenders eat their losses when things went bad than you’d probably see HELOCs with 10% interest rates rather than 5%.
Participant[quote=flu]Meh… A bunch of hand motions, maybe a small fine here and there and then that’s about it.
Just like..
Folks like Super J will continue to be able to practice, etc….
People that took out liar loans will recover and be fine…
It’s time to move on…There will be no major “punishment” for anyone for the great recession…
At least not in your lifetime…[/quote]
The statue of limitations has already been run. I figure the big losers will be the pension funds. Maybe you can try the taxpayer bailout of the pensioners, but I personally think by the time you need to do the bailout the taxpayer well will be dry and the pensioners get screwed. It’s not that they’ll deserve it, it just that they’ll be the easiest group to screw in an array of bad choices.
February 1, 2013 at 11:40 AM in reply to: No money down loans are back…(psuedo-affluent borrowers only..) #758759ParticipantIt always amazes me that everybody thinks they can win the leverage arbitrage game. Don’t worry I’m going to borrow at 3% and make 7-8%. While some have proven to be successful at this, and usually cash in big with a book or a seminar, the math says that for every winner at this game they has to be a loser. In most cases there’s a couple big winners and a lot of losers wondering what went wrong.
Participant[quote=bearishgurl]
I am completely against this. I know several people (early gen-x-ers and boomers) who have deliberately taken out $65K to $120K in student loans AFTER the age of 45. I have NO IDEA who any of them think would hire them in this day and age after they obtained their lofty credentials. In all cases, this was an utterly foolish idea, IMHO.At any age, it is grossly unfair to those who kept their noses clean and only paid for the education their could afford in life. IOW, their “contemporaries” (who elected NOT to borrow for college) shouldn’t be “outgunned” in the job market by those who successfully “stole” a bachelor’s degree or even graduate degree!
A college “degree” is not something which can be repossessed. There is no collateral here. The benefits of a degree follow the former student until their deaths. Just like a personal injury award (a condition that follows the individual who sustained the injury until their death), the injury award/college debt legally belongs SOLELY to the affected person.[/quote]
These people will get bailed out at some point. Most likely the taxpayer as politicians look to buy irresponsible people votes. We did it with housing we’ll do it with college loans. It never ends.
Participant[quote=AN]
I wouldn’t 100% count on interest rates either. It depends on why interest rates went up. If the reason is like the 70s, good luck trying to catch the nominal price.[/quote]Why did the interest rates go up in the 1970’s. I’d argue that the primary reason was baby boomers coming of age and demanding loans for houses while there was limited supply. In essence the supply demand curve for creditors and debtors was skewed heavily towards the debtors. Over time that curve has switched as baby boomers would rather be creditors rather than debtors as they approach retirement. I really think everything is going to boil down to the demographics in the end barring some miracle technology breakthrough.
In a decade or so when the boomers go from asset collectors to asset sellers asset prices will decline. Maybe not nominally but in real terms they will. Maybe the boomers will reverse mortgage homes and stay there but it’s hard to see a scenario where asset prices keep rising faster than the economy grows when a large portion of the population is going to be looking to cash in those assets either via rent collection or outright sale. Maybe I’m just looking at this too analytically or logically.
Participant[quote=flu]Well the thing that irks me is these nickel and dime fees. You know you think that the lender would be obligated to disclose of all these nickel and dime fees before escrow.. But maybe I missed it, I don’t recall there being a disclosure of these fees (just how much your payments will be)….
Also, not that I’m planning to but the way provident is set up, they really discourage you to make irregular extra principal payments. I don’t think you can do it…[/quote]
It’s hard to make money when you loan margin is like 2%. Nobody works for free, so if you get an ultra low rate expect to pay for it in hidden fees. In a typical California house the lower rate make up for the fees but on some houses in the country below $150K-$200K the fees might be more than the rate savings.
January 29, 2013 at 6:51 AM in reply to: The Real Story Of How ‘Untouchable’ Wall Street Execs Avoided Prosecution #758657Participant[quote=CA renter]
You know what’s sad? Look at the number of comments responding to the many excellent threads posted by sjk…maybe 3-5, sometimes zero. Yet, when the subject matter is about cops, firefighters, teachers, senior citizens with their pitiful pensions or SS/Medicare benefits, etc. — people who had absolutely nothing to do with the economic crisis, and those who perform services for the community that are far more valuable than what these Wall Street parasites do — we get hundreds of ignorant, nonsensical posts trying to lay the blame on working people instead of where it belongs: at the top.Time to wake up to what’s really been going on, and start paying attention to who is behind the anti-worker message we’ve been bombarded with over the past few years and understand why they are doing it. It’s a diversion tactic meant to divide and conquer. If we allow the elites who control our government to continue down the path we’re on, there will come a point when it will be too late for a peaceful resolution to our nation’s problems.[/quote]
The reality is nobody disagrees with this article. Nobody is saying we shouldn’t prosecute the bankers so there’s really nothing to debate and therefore it gets low interest. The issues where there are actually multiple view points are going to get comments and debate.
I suppose I could post yeah, I agree. Obama administration is exactly the same as Bush’s see how republicans aren’t different from democrats. Wee political thread jack, this should get interesting.
ParticipantToo many people have already shorted HLF. 38% of the float is out short. That’s worse than left for dead companies like RIMM or NFLX. I certainly wouldn’t get on the short side of HLF. It’s bound to be squeezed over and over again until you actually get a breaking news story that it is a ponzi scheme.
Participant[quote=no_such_reality]
Note: Rich T, can you do us a favor and reduce those graphics?[/quote]
I would have been able to do it myself but once it got quoted I can’t edit the original post anymore.
img tab just needs a width and heigth parameter.something like width=”200″ height=”150″
Participant[quote=bearishgurl]
livinincali, just because there are more people in the US using food stamps now than in 2006 doesn’t mean the program has been increased by a significant amount of money or increased at all.
[/quote]Seriously, could you at least do a quick google search and a little research before making this claim. Food stamp spending increased to record 80.4 billion per year in 2012. In Obama’s first year of office 2009 it was 55.6 billion.
http://cnsnews.com/news/article/federal-food-stamp-program-spent-record-804b-fy-2012
Nobody wants to see anybody go hungry. I’d like to see this program actual go back to providing nutritious food to people. Not a debit card to spend at Walmart when the clock sticks midnight of the 1st of the month.
Participant[quote=SK in CV]
No, that doesn’t prove any expansion of specific programs, only increases in costs.
[/quote]The ACA or better known as Obamacare is certainly an entitlement expansion.
[quote=SK in CV]
You, and Romney and many other Republicans call it the “entitlement attitude”. The givers v. the takers. The vast majority of that 47% are retiree social security beneficiaries. Double down on that. Over and over again. See how it works out for you.
[/quote]That’s pretty much the problem. The taker side is essentially the majority now. Of course they’ll vote to keep those programs going whether we can afford them or not. If you go down that path you eventually end up in Greece’s shoes. Sure we can print but money in itself has no value. It’s the total goods and services you can take and redistribute that has value.
The reality is that this won’t end well. Whether it’s massive austerity like Greece or some kind of hyper inflationary event we’ll end up in a depression. When the pain gets bad we’ll likely have a majority that begs for a socialist government solution and everybody will get poorer. Those with the means will escape the country but loose a lot of assets in the process. Honestly real estate is a pretty shitty investment unless we get our fiscal house in order soon. Just wait until the government redistributes rental properties to the current tenants.
Participant[quote=SK in CV][quote=SD Realtor]
No these programs have not been cut or decreased. You are not correct. more important, the number of people needing the assistance has grown. [/quote]Which programs have expanded benefits in the last 8 years?[/quote]
How about food stamps
How about looking at the Federal budget numbers for medicare, medicaid and social security over the past 8 years.
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