see attatched chart. one word....WOW, or two HOLY CHIT!
This is going to turn so ugly, and a lot of people are going to get hurt even worse then they already have been. The best thing for the government to do is probably going to be to let things take their natural course, which is what we eventually end up having to do coz we are broke..but it would be nice if we did it now as an active choice.
I do feel bad for people. When we moved to Florida (Sarasota) in 2005 the person who gave us our loan literally told us we were making a horrible choice. She said that "the smartest people" are buying all the house they can afford, and then putting as little down as possible, because even if all prices do is keep going up at a palty 5% per year if we just put 5% down on hour house and "stretched as far as you feel comfortable, and then stretch a little more" we would be doubling our deposite every single year. And of course real estate in South Florida NEVER has gone down, and since we could afford to live on the water if we wanted we had even more of a sure thing!
We kept our heads about us and put 30% down and got a regular 15 year conventional mortgage. Obvisously still paid a lot for it, but it is a house that can be lived in "forever" and it's very nice. I'm glad that we had the financial IQ to tell her to shove it, I feel very bad for those who did not.
Here is the link to the entire NY Times article: http://www.nytimes.com/2009/02/08/us/08lehigh.html?_r=2&pagewanted=1&em
This is going to turn so ugly, and a lot of people are going to get hurt even worse then they already have been. The best thing for the government to do is probably going to be to let things take their natural course, which is what we eventually end up having to do coz we are broke..but it would be nice if we did it now as an active choice.
I do feel bad for people. When we moved to Florida (Sarasota) in 2005 the person who gave us our loan literally told us we were making a horrible choice. She said that "the smartest people" are buying all the house they can afford, and then putting as little down as possible, because even if all prices do is keep going up at a palty 5% per year if we just put 5% down on hour house and "stretched as far as you feel comfortable, and then stretch a little more" we would be doubling our deposite every single year. And of course real estate in South Florida NEVER has gone down, and since we could afford to live on the water if we wanted we had even more of a sure thing!
We kept our heads about us and put 30% down and got a regular 15 year conventional mortgage. Obvisously still paid a lot for it, but it is a house that can be lived in "forever" and it's very nice. I'm glad that we had the financial IQ to tell her to shove it, I feel very bad for those who did not.
Here is the link to the entire NY Times article: http://www.nytimes.com/2009/02/08/us/08lehigh.html?_r=2&pagewanted=1&em
