Making lines

Richard Henry wrote:
On May 12, 9:14 am, Walt wrote:

BUT, the ARMs were used, abused, twisted, folded, spindled, and
mutilated into the mess we have now. Yeah, the borrowers should
shoulder a lot of the blame, but it takes two to tango: Mortgage brokers
gave loans without regard to whether the borrower could pay; they didn't
care since they sold the loans immediately. Investors bought these bad
loans, pretended like they were


It is interesting to note that the mortgages were allowed to fail all
over the country until some big Wall Street firms started having
trouble because of their sub-prime investments. Suddenly we heard
calls from Washington to save the homeowners.


When you owe the bank $1000 and can't pay, you have a problem.
When you own the bank $1M and can't pay, *the bank* has a problem.

When the bank* has $1B in loans to people who can't pay, and there are
hundreds of banks in this situation, *the country* has a problem.

So....everybody gets a bailout:
http://preview.tinyurl.com/485ahs

(except Jack, of course)

*I use the term "bank" loosely here. The institutions in trouble are
not technically banks; they're investment firms trading in mortgage
backed securities. The beauty is that they aren't subject to the same
regulations as banks, but the Fed will bail them out when they fail just
like a failing bank. It's all the benefits of federal backing with none
of the responsibility! WHEEE!

//Walt

Walt wrote:
This site seems to indicate that 30 year fixed rate mortgages are
available in Oz. http://www.dinkytown.net/java/AULoan.html

Um, that's an Amercian site.

You probably can lock in a rate for 30 years, but it'd be a bloody high
rate.


--
ant
Don't try to email me!
I'm using the latest spammer/scammer's
email addy.

Walt wrote:
ant wrote:
Harry Weiner wrote:

Then I'm buying my mother a DVD player, for Mother's Day, so she can
watch the movie, "Beowulf."

Mothers often like Beowulf.


Are you saying that his mother looks like Beowulf?

More like Grendel, I suspect.


--
ant
Don't try to email me!
I'm using the latest spammer/scammer's
email addy.

ant wrote:
Walt wrote:
This site seems to indicate that 30 year fixed rate mortgages are
available in Oz. http://www.dinkytown.net/java/AULoan.html

Um, that's an Amercian site.

Yep, you're right. My mistake.

Digging deeper, it seems that once again we are cultures separated by a
common language:

http://www.hsbc.com.au/1/2/personal/...ng-first/faq#6

"A fixed rate loan is where the interest rate is fixed for a period of
time that is between one and five years. At the end of the fixed term,
the loan reverts to a variable rate."

So, yes, you can get a "fixed rate" mortgage in Oz, but it's not the
same thing we call fixed rate here in the states. I had no idea that
the term meant something completely different down there.

//Walt

On May 12, 10:25*am, Richard Henry wrote:
On May 12, 9:14*am, Walt wrote:

BUT, the ARMs were used, abused, twisted, folded, spindled, and
mutilated into the mess we have now. *Yeah, the borrowers should
shoulder a lot of the blame, but it takes two to tango: Mortgage brokers
gave loans without regard to whether the borrower could pay; they didn't
care since they sold the loans immediately. *Investors bought these bad
loans, pretended like they were

It is interesting to note that the mortgages were allowed to fail all
over the country until some big Wall Street firms started having
trouble because of their sub-prime investments. *Suddenly we heard
calls from Washington to save the homeowners.

Replying to both:

Here's my problem with it. Instead of an ARM I got a standard loan.
Because I could and because I didn't want the volatility. Like Walt
says, I could have and had lower payments all these years but had I
missed the refinancing opportunity when it was right I could be
screwed.

But some people went out and got too much house and or were just
ignorant of the big picture and now are in trouble after 5 years (?)
of payments 1/2 of mine and they are going to get bailed out??????
What about me. I am still able to afford my house!!!! I did the
responsible thing from the start!!!!!! Where's my money that I paid in
higher payments this whole time?????? My bet is that many of the
bailed out will have Escalades with the 22" rims, cell phones, giant
plasma tv's, travel, all that ****, and keep it if not get more
because their scam worked!!!!

IT'S BULL****

On May 13, 3:35*pm, pigo wrote:
On May 12, 10:25*am, Richard Henry wrote:

On May 12, 9:14*am, Walt wrote:

BUT, the ARMs were used, abused, twisted, folded, spindled, and
mutilated into the mess we have now. *Yeah, the borrowers should
shoulder a lot of the blame, but it takes two to tango: Mortgage brokers
gave loans without regard to whether the borrower could pay; they didn't
care since they sold the loans immediately. *Investors bought these bad
loans, pretended like they were

It is interesting to note that the mortgages were allowed to fail all
over the country until some big Wall Street firms started having
trouble because of their sub-prime investments. *Suddenly we heard
calls from Washington to save the homeowners.

Replying to both:

Here's my problem with it. Instead of an ARM I got a standard loan.
Because I could and because I didn't want the volatility. Like Walt
says, I could have and had lower payments all these years but had I
missed the refinancing opportunity when it was right I could be
screwed.

But some people went out and got too much house and or were just
ignorant of the big picture and now are in trouble after 5 years (?)
of payments 1/2 of mine and they are going to get bailed out??????
What about me. I am still able to afford my house!!!! I did the
responsible thing from the start!!!!!! Where's my money that I paid in
higher payments this whole time?????? My bet is that many of the
bailed out will have Escalades with the 22" rims, cell phones, giant
plasma tv's, travel, all that ****, and keep it if not get more
because their scam worked!!!!

IT'S BULL****

Jealous?

On May 13, 6:35*pm, pigo wrote:
snip

I worked in corporate finance for 30 years. I could tell you many
detailed reasons for this happening but it boils down to couple of
basic things, stupidity and greed.

A senior vp of one of my corporate banking group once called real
estate "the cocaine of banking". After a while people start lending
without looking at the fundamentals. The real estate market crashes
every 10 or 15 years from speculating. Most borrowers don't look at
downside potential - you always have to be cognizant of interest rate
risk and roll over risk. In a traditional situation you pay higher
rates to reduce roll over risk however with the advent of ARMS that
all flew out the window. When ARMS first came about the move would
come after 3 years or so and then you would lock in for long term.

Most people are not willing to look at long term real estate
volatility. They just figured that the run up in housing values was
equity that they could cash in. Here's an example

http://tinyurl.com/54oyhl

Over the course of this last runup, I paid off my mortgage. In made
more financial sense than the other investments at the time. The tax
benefits were not significant enough to keep it. In the last few
months, the mkt value of my house has dropped 20%.

The rules are Higher Debt brings Higher Bankruptcy Risk.

I believe that both the financial institutions who fueled the subprime
fiasco and the people who foolishly borrowed excess amts of money
based upon inflated values should both be held accountable and pay the
consequences.

PS: By the way I get a little snicker about who gets blamed for this
1.) Look up the financial shenangans that took place at Fannie Mae and
Freddie Mac over the last few years and look at who is responsible for
putting those people in charge.
2.) The justice dept is not responsible for regulating financial
institutions. Among the most important are the Federal Reserve and the
SEC.
3.) Look at some of the kooks and their history of some CEO's of some
of the biggest players in this fiasco - like Merrill Lynch (He is not
a GWB supporter).

Before you jeopardize your family's well-being you should use your
head. The bigger the return the greater the risk - no exceptiions -
EVER.

Two days after the Merrill CEO got canned, my father got a call from
his Merrill broker wanting him to invest in a zero-coupon mutual fund.
They're always looking to get your money some how. Zero Coupons were
invented to give high credit risk companies access to the debt mkt. It
never ends. The info went into the trash.

Walt wrote:
ant wrote:
Walt wrote:
This site seems to indicate that 30 year fixed rate mortgages are
available in Oz. http://www.dinkytown.net/java/AULoan.html

Um, that's an Amercian site.

Yep, you're right. My mistake.

Digging deeper, it seems that once again we are cultures separated by
a common language:

http://www.hsbc.com.au/1/2/personal/...ng-first/faq#6

"A fixed rate loan is where the interest rate is fixed for a period of
time that is between one and five years. At the end of the fixed term,
the loan reverts to a variable rate."

So, yes, you can get a "fixed rate" mortgage in Oz, but it's not the
same thing we call fixed rate here in the states. I had no idea that
the term meant something completely different down there.

You can lock in the rate for a period of time, but I was pretty sure the
maximum was around 5 years. Then you're at the mercy of the market, and what
it's doing at the time. Some people might re-finance and get another fixed
rate, but many loans have a penalty for early repayment. So people plannign
to do that would have to ensure they got a loan without early repayment
penalties, and I imagine that would mean a higher interest rate from the
start, or higher fees (they get their money somehow).

But being able to lock in a fixed interest rate for 30 years would be too
good to be true, here. Some years back, interest rates on home loans shot
up in to the high teens, and that was pretty horrific for people as their
repayments doubled or worse. It was a bad market adjustment and they came
down again, but it was a bad time.


--
ant
Don't try to email me!
I'm using the latest spammer/scammer's
email addy.

ant wrote:
Walt wrote:
ant wrote:
Walt wrote:
This site seems to indicate that 30 year fixed rate mortgages are
available in Oz. http://www.dinkytown.net/java/AULoan.html
Um, that's an Amercian site.
Yep, you're right. My mistake.

Digging deeper, it seems that once again we are cultures separated by
a common language:

http://www.hsbc.com.au/1/2/personal/...ng-first/faq#6

"A fixed rate loan is where the interest rate is fixed for a period of
time that is between one and five years. At the end of the fixed term,
the loan reverts to a variable rate."

So, yes, you can get a "fixed rate" mortgage in Oz, but it's not the
same thing we call fixed rate here in the states. I had no idea that
the term meant something completely different down there.

You can lock in the rate for a period of time, but I was pretty sure the
maximum was around 5 years. Then you're at the mercy of the market, and what
it's doing at the time. Some people might re-finance and get another fixed
rate, but many loans have a penalty for early repayment. So people plannign
to do that would have to ensure they got a loan without early repayment
penalties, and I imagine that would mean a higher interest rate from the
start, or higher fees (they get their money somehow).

But being able to lock in a fixed interest rate for 30 years would be too
good to be true, here. Some years back, interest rates on home loans shot
up in to the high teens, and that was pretty horrific for people as their
repayments doubled or worse. It was a bad market adjustment and they came
down again, but it was a bad time.

While we are gloating about not being caught in the credit cruch,
I re-wrote my loan 2 years ago at a very favorable 15 year fixed
rate of 5 7/8%. This was fixed for the whole 15 year term. Early
this year, rates were going down for for folks with good credit.
My lender offered to rewrite at 5 1/4%, no fees, still 15 year
fixed for the whole term. I'm doubling payments each month with
the plan to be paid off in 5 years (yes, I've done the math, it
works). There is no prepayment penalty in Vermont. It's illegal.

VtSkier wrote:
While we are gloating about not being caught in the credit cruch,
I re-wrote my loan 2 years ago at a very favorable 15 year fixed
rate of 5 7/8%. This was fixed for the whole 15 year term. Early
this year, rates were going down for for folks with good credit.
My lender offered to rewrite at 5 1/4%, no fees, still 15 year
fixed for the whole term. I'm doubling payments each month with
the plan to be paid off in 5 years (yes, I've done the math, it
works). There is no prepayment penalty in Vermont. It's illegal.

I'm at 4.5% fixed for 15 years. I'm pretty happy right now. I
refinanced a 30 year fixed rate loan down to 15 years at the same
monthly payment. My broker kept pressuring me to lock in a lot sooner,
but I was patient, and it really paid off. I've only got about ten
years left.

-klaus