Today everyone has the distinct pleasure of hearing me vent on two separate topics, Nicholas Cage (who I love) and the upcoming mortgage bailout (which I hate).
First, lets start with Nicholas Cage. Simply put, this guy rocks. His movies are not Oscar worthy, they just kick ass, and keep you glued to your sit for 90 minutes. I just rented Next and loved it, although the ending was a bit lame, but that wasn't Cages fault. Also, his National Treasure movies are also awesome. If you haven't seen them you need to check them out. I love this guy and his movies.
For details regarding my hatred of people who are foolish enough to think that they could afford a $300,000 house with an income of $60,000 please check out the replies to the following link (near the bottom, I am cheffern):
click here to read why I hate stupid people
I was just talking with a co-worker about this topic, and I created the following example: So, one day you're sitting on your couch and your phone rings. Someone says to you, "Congratulations! You have been found eligible to purchase a brand new Porsche! You don't have to put any money down and the first year all you have to pay is $100 a month. However, after the first year the monthly bill might adjust, but that won't happen for a year."
The logical person would say to themselves, "wait a minute, a Porsche costs a lot of money. I don't think I could really ever afford one. In addition, what happens if in the future the price adjusts to a level I can't afford? This doesn't sound like such a great deal after all."
However, America is full of idiots who ignored all reason and logic and went ahead and bought that Porsche. Now the government is going to bail out a percentage of these folks. Furthermore, guess where the highest levels of foreclosures are? Florida and Ohio. Also, guess where Presidential elections are won and lost? Florida and Ohio. I bet $10 that the big issue come next November will be mortgage bailouts for residents of the Sunshine and Buckeye states. I love America, but sometimes I hate it as well.
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3 comments:
Colin, the only flaw in your analogy is that ALL OF YOUR FRIENDS AND NEIGHBORS ARE BUYING PORSCHES TOO.
These mortgage "deals" have been going on for a decade, and millions of people took advantage of them. It just became the norm to buy more house than you can really afford.
I have some personal experience in this. I too got a 5 year ARM that is due to mature in 2008. I think Ali and I make too much to qualify for this bailout though. I got it for 2 reasons - I knew I would be selling my house before the 5 year period expired, and it was DAMN CHEAP! Really it was a win-win for me. If I knew I was staying someplace indefinitely, a 30 year fixed is the only way to go.
Also, when Ali and I got pre-approved for our mortgage, the broker literally ASKED ME how much I wanted to be pre-approved for! These guys were throwing money around without even thinking about it. Fortunately, Ali and I realized how much we could afford, and only applied for that (around 1.5 times our salaries).
I agree. This is a bunch of BS and people are dumb, but I think the mortgage companies dropped the ball in an effort to close as many loans as possible while the interest rates were low. Looks like they are paying the price now.
Colin, as far as I've read, there is actually no money being spent by the government. Dubya basically signed a act that said if you meet qualifications such as never having missed a payment, your ARM will not mature for another five years. No money spent, no loans defaulted on.
A lot of the mortgage companies are actually OK with this because it means their homeowners will continue to pay. However, it doesn't change the fact that in five years this crunch will be monumentally huge, because once this act of government expires, you'll have an immediate maturation for a huge number of mortgages.
I don't understand people's idiocy, and I don't understand why a bank gives a $300K loan to a family with a Gross Annual Income of $60K. I used to think that it's because there's so much mortgage paperwork that people get confused and don't know what they're signing, but the bank, realtor, and title company all go through this stuff in detail with you. It's mind-boggling why people are dumb.
Also, I like Nick (Coppola) Cage movies as well. Nick Cage as a person is, not surprisingly, bat-shit cray.
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