The State of American Journalism

[ragged325]

Here's why homeowners are not responsible.

Let's say I offer you $100K with no strings attached? Do you take the money? Of course you do, you'd be stupid not to.

Let's say after you take the money, I tell you that I was going to feed a bunch of starving Africans with it and that you're an asshole for taking it. That's what you're saying to the homeowners.

Here's what the banks/mortgage brokers offered:

Bank: I'd like to go in on an investment with you, Joe Homeowner

Joe: How does it work?

Bank: We'll buy a $300K investment together. You put down $15K (we'll give you a loan for that part) and we'll put down $285K.

Joe: What happens if it goes up in value?

Bank: Well, you can sell it at any time, pay off the loan and take all of the profit for yourself (minus realtor fees, etc.).

Joe: That sounds great, but what if it goes down in value?

Bank: Well, you get to walk away from the deal, but we're going to tell other banks that you didn't pay. We'll put a special mark on your credit report.

Joe: I'll take it.

Heeter: Joe, you were an asshole for taking this loan.

Personally, I didn't think property values would continue to go up forever. In 2005 I did a cash-out refinance for all that I could get with a 5.375%, 30-yr. fixed interest rate and bought a pool cleaning business. My sister was in the same situation, but sold her condo and bought a big house she couldn't afford (which she was able to sell at a loss before she was foreclosed on). If my business fails and I can't repay the loan, was I an asshole for taking it in the first place? I don't think so. I would have been stupid to pass up the opportunity.

[Vedubin01]

ragged, as you stated above.

No you did the right thing as long as you took out enough money to get over that start up hump and did not squander most of the money away on items that were not beneficial to the growth of the pool company. You were also educated enough to know what kind of loan you got and got one fixed at a pretty low secured interest rate. But you are the few that did just that. Most of them were like your sister and are following your sister's example.

[z31maniac]

As far as shitty journalism, as bad as this may sound, it doesn't pay shit. I the whole reason I initially got into the school of Journalism was so I could be an investigative reporter. Then I realized most people don't give a shit and look down their nose at Journalists.

If I was writing for the Tulsa World right now, I'd probably LITERALLY be making 50% of what I do now.

[rwh11385]

Ragged, you're right, no one should be responsible for themselves. Hell, welcome to the U.S.S.A. You don't need a stinking 401k, the government will take care of you with their new 5% taken for SSA-controlled retirement account.

[rwh11385]

Here's why homeowners are not responsible.

Let's say I offer you $100K with no strings attached?

I'm sorry, did you REALLY just say that?

If you can't read a contract, you shouldn't be signing one.

If you believe whatever a salesman says, you probably have a Monavie business or in part of other MLM schemes.

How hard is it to google what % of your income should debt payments be?

[DarkWing6]

Ragged, what you are saying is that I should have taken full advatage of the $50K car loan the bank offered me becasue they offered it? Even though I know that I could not come close to making the payment after rent, insurance, and all my other bills.

[ragged325]

Heeter, now I don't even know what you're talking about.

I googled Monavie business and it talks about juice. My business is that I clean and repair rich people's pools and they pay me. WTF are you talking about?

I did Google what % of your income your home loan should be. I didn't think the bank would loan me the money. They said they didn't care about that stuff. I figured it was their money so why should I care.

I read the contract. It said, if you don't want to pay just walk away (in so many words). I only put 10% down (even though I had 20%) and did not have a subprime loan. I could have sold the house at the peak of the market and walked away with $200K. But you're saying I'm an asshole and should not have taken the loan because Google said I wasn't qualified?

Let's face it, everyone is responsible for looking out for their best interests. The homeowners looked after their interests (potential to make lots of $ with little risk) and the banks did not look after their interests (giving out money to people who could not pay it back). It was never the homeowner's responsibility to look after the banks' interests. Now you know how the real world works.

Now I'm wondering why I'm bothering to reply to your non-argument instead of making money.

Darkwing, there is no potential to make money flipping new cars. It would not be in your best interests to buy a new car you could not pay for.

[ragged325]

One other thing. If you exclusively get your news from Fox and the r3v off-topic lounge, you should not blame the media because you're uninformed. It's your own fault. I read foxnews.com just about every day. I also read cnn, msnbc, and realclearpolitics.com (which has articles from Newsweek, the Weekly Standard, Time, The Wall Street Journal, The New York Times, Washington Post, etc., etc.).

Unfortunately, since I don't watch Fox news, I'm woefully ill-informed about which blond girl is missing this week.

[rwh11385]

Heeter, now I don't even know what you're talking about.

I googled Monavie business and it talks about juice. My business is that I clean and repair rich people's pools and they pay me. WTF are you talking about?

I did Google what % of your income your home loan should be. I didn't think the bank would loan me the money. They said they didn't care about that stuff. I figured it was their money so why should I care.

I read the contract. It said, if you don't want to pay just walk away (in so many words). I only put 10% down (even though I had 20%) and did not have a subprime loan. I could have sold the house at the peak of the market and walked away with $200K. But you're saying I'm an asshole and should not have taken the loan because Google said I wasn't qualified?

Let's face it, everyone is responsible for looking out for their best interests. The homeowners looked after their interests (potential to make lots of $ with little risk) and the banks did not look after their interests (giving out money to people who could not pay it back). It was never the homeowner's responsibility to look after the banks' interests. Now you know how the real world works.

Now I'm wondering why I'm bothering to reply to your non-argument instead of making money.

Monavie is a typical MLM scheme that idiots buy into. It's "legal" but people get suckered into it. Whose fault is that, especially when more intelligent people say it is a scheme and should be avoided. 6 months later, guess who is saying I told you so.

I didn't know ignorance was a defense these days when it came to finances, but I guess if you want to defend those who are dumb about the deals they got into - that is your only approach.

The banks didn't have to worry about the $, if the borrowers could pay or not, because that liability was not paid to them after they passed on the asset which was that claim. The government was the first to do this, and made it popular, and no one was long enough looking to forsee an issue with this.

But that does not mean it was okay for borrowers to be irresponsible with their money.

Maybe you don't care about your credit score, which could be true of people in the 600s taking out the subprime loans, but being foreclosed on is not awesome.

Darkwing, there is no potential to make money flipping new cars. It would not be in your best interests to buy a new car you could not pay for.

So you shouldn't take the offer just because it's there? It is a bad strategy to use subprime lending and ARM's to buy a 3million-dollar house you can't afford and want to flip, but that didn't stop people from trying.

[DarkWing6]

Darkwing, there is no potential to make money flipping new cars. It would not be in your best interests to buy a new car you could not pay for.

I guess I don't understand your double standard. If a bank offers me a home loan I cannot afford it is their fault for offering it, but if the same bank offers me a car loan I cannot afford then it would be my fault for taking it?

How do you not understand that either way if I accept the loan it is MY fault? I signed the contract. I agreed to the deal. That means I accept the consequences good or bad. Just like our legal system, ignorance doesn't make it ok.

[ragged325]

You are not responsible for worrying about whether or not the bank is making money. They hire smart people to do that for them. If they offer you money, and it's in your interests to take it, go ahead. If it's not to your advantage, don't take the money. If the "deal" is that your really don't have to pay it back, you're not ignorant for understanding the consequences.

The reason people tried to flip houses is because a lot of people made a lot of money doing it. It wasn't a sure thing (especially in 2004+) but you were risking the bank's money (not your own). Maybe someone else can explain this to you (it's not very complicated). I have to go to work. I'm not going to explain this again. Please do yourself a favor and do not go into business for yourself.

[rwh11385]

You are not responsible for worrying about whether or not the bank is making money. They hire smart people to do that for them. If they offer you money, and it's in your interests to take it, go ahead. If it's not to your advantage, don't take the money. If the "deal" is that your really don't have to pay it back, you're not ignorant for understanding the consequences.

The reason people tried to flip houses is because a lot of people made a lot of money doing it. It wasn't a sure thing (especially in 2004+) but you were risking the bank's money (not your own). Maybe someone else can explain this to you (it's not very complicated). I have to go to work. I'm not going to explain this again. Please do yourself a favor and do not go into business for yourself.

So you're trying to say there are NO consequences at all for walking away from a loan?

have fun scrubbing those pools

[Ral]

wait a minute.. so the banks (at the prompting of the government) created what amounts to a free buffet. Most homeowners then went at it, grabbing as much as they possibly could get, regardless of the consequences. Then, when the banks ran out of food (yes, this is simplistic, I read through how it all works) and people are sick to their stomachs because they couldn't control the amount of food they ate and are now complaining because they feel sick and got fat, they should not be blamed. Yes, it was a bad idea to open the buffet in the first place. But that doesn't absolve the people who dined there who shouldn't have, or who bit off more than they could chew.

[rwh11385]

wait a minute.. so the banks (at the prompting of the government) created what amounts to a free buffet. Most homeowners then went at it, grabbing as much as they possibly could get, regardless of the consequences. Then, when the banks ran out of food (yes, this is simplistic, I read through how it all works) and people are sick to their stomachs because they couldn't control the amount of food they ate and are now complaining because they feel sick and got fat, they should not be blamed. Yes, it was a bad idea to open the buffet in the first place. But that doesn't absolve the people who dined there who shouldn't have, or who bit off more than they could chew.

hahahhaahha.

Nah man, the government and the people cannot be blamed, only the banks according to ragged and the "Ctrl-C" and "Ctrl-V" he can do...

[Ral]

but seriously, is that about right?