Sunday, April 06, 2008

This is what you get when you pander to irresponsible morons

You get people who "purchased" a home they couldn't afford with an absurd mortgage they couldn't pay, apparently gambling that home prices would go up and they could refinance with the supposed equity in their home as a 'downpayment.'

'Course -- too bad -- bad bet, dumbass. Housing prices went down. Now the useless porkchops are blaming America.

Here's the people they should actually blame:

1. Liberals.

To wit, The New York Times who wrote a teary story about how irresponsible loans help the poor! Yippee! These weren't bad mortgages made to greedy airheads who couldn't use a calculator. No! They were INNOVATIVE.

2. Themselves.

If you are too stupid to see you can't afford a balloon loan, you are too stupid to own a house.

You know right now if you lose your house to foreclosure, what happens is that you get a bad credit score then go rent an apartment. The only people who lose are the lenders for trusting your useless ass.

Used to be that defaulting on your debts was a crime equivalent to theft. And, of course, it is theft. You went to freaking PRISON for defaulting on your debts.

We got rid of debtors prison on the premise that the risk for default should be assumed by the LENDER. Now what we are getting is a social movement, headed up by Welfare cases, who say that neither the lender nor the debtor should suffer from bad loans. Instead those of us who handle our affairs best should suffer.

Bring back debtor's prison. I think it would do wonders for this society.


Blogger Gayle said...

"Bring back debtor's prison." LOL! A bit harsh, but how else to get through to such stupid people? You're exactly right, Walker. They decided to live above the means they could afford and I don't see why anyone should have to bail the dumbasses out!

2:26 PM  
Blogger Jamie Carin and Claudio Romano said...


8:39 AM  
Blogger said...

The banks share a lot of the blame here, and the regulatory bodies (and ratings bodies) involved. While most of the big banks engaged directly in this foolishness, there were even more fly-by-night mortgage companies offering these crazy loan-shark loans to suckers . . . to people whose credit history (and education, among other things) gave no indication that they could possible afford a sudden doubling of their mortgage payment. But the fly-by-nights intended to bundle all these bad mortgages together and sell them to the big banks, who bought them based on their four-star ratings (which they should never have gotten, if legitimately analyzed based on the likelihood of default).

While there used to be a time when there were debtors prison, there also used to be a time when banks could not legally make these kind of absurd loans. I think there was also a time when the big banks would have known better--that is, they would have known that loans where the payments double and triple over a period of a few years--balloon payment, interest-only--are the loans that are almost guaranteed to default, and then the bank will be stuck with an abandoned property in a bad housing market.

Yes, they people who signed up for these things are idiots, but so are the banks who thought these loans were good ideas in the first place. I'm not a big fan of government regulation, but I think it would be better for everybody if consumer loans--home equity, mortgages, credit lines--were, by law, of one type: fixed-interest loans, either straight interest (credit lines) or ammortized (mortgages). It would be better for consumers, especially the stupid ones, better for the banks, better for the investors in those banks, and better for the economy.

Oh, and while I think the banks are largely responsible for the current mortgage mess, the idiots who signed up for these stupid loans do not deserve a bail out (nor do the banks). Though, unfortunately, we're all going to have to lie in the bed these morons made.

Good market to go house shopping if you can pay cash, tho.

10:59 AM  
Blogger Walker said...

Of course you are spot on, Kevin.

I would emphasize more than you the essential idiocy and greed of the subprime mortgage holders, I suppose. And their dishonesty in then blaming everyone but themselves for their own stupidity.

Caveat Freaking Emptor.

AND then demanding that, the deal notwithstanding, they should still get the house they can't afford for some fantastic deal that they can afford.

Hell, I have a house I can afford. It's a little too small, though. Maybe it's time to picket: My House Is Too Small and It's Your Freaking Fault. Buy Me A New One.

11:28 AM  
Blogger said...

I'll join you, Walker. I feel the same way. "More closet space and a game room are a right! I'm entitled to it!"

I'm in the same boat--I bought a house I could afford, four times under what I could get a traditional loan for! When I saw I could get a $500,000 house loan, I had to wonder if the people at the banks were smoking crack. There was no way I could do that and afford to make the note, in the short run much less the long run. Fortunately, I had the good sense to see a $100,000 was more in my affordability range.

3:07 PM  

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