Should Foreclosed Homes Be Sold By the Bank...?At extremely low prices? I was just reading how millions and millions of people, of every financial status (poor, middle class, etc.) are homeless or facing the possibility. What I am saying is, the banks let those houses be sold for those incredibly inflated prices a couple years ago, and now they're... |
Yep that is true the banks own them. The banks and mortgage companies did this to themselves. Think about who is winning in the housing situation? I wish congress would enact some law that says the bank or company must not resell foreclosed home for a certain am out of time. Let them sit on the houses for say a year or 5. Maybe just maybe they would be more willing to work with homeowners instead of repossing the house.
Its not the banks responsibility to not allow homes to be sold at inflated prices. That is the law of supply and demand. If 20 people are bidding on a house in a desirable neighborhood, the seller typically gets over the asking price.
The bank is responsible for ensuring that the person buying the home can do so and can afford it. When I bought my 1st home, I had to have at least 10% down. It used to be 20%. Now you can buy a home with no out of pocket or you have interest only loans.
These are the practices that have caused the financial crisis today. People got into the Adjustable Rate Mortgages or into the Interest only mortgages. After the 3 or 5 year initial period, these loans typically adjust up and your payment goes up.
For someone who is living paycheck to paycheck, this allowed them to live in a house vs. an apartment. However as soon as the loan adjusted, they could not afford the payment and some people just walked away from their mortgages.
The banks have profited on these practices, now they are being hit hard because it bit them in the butt because 1) the person taking out the loan didn't understand what they were doing or 2) they were not qualified to own the house to begin with.
They need to eliminate the interest only and ARM's and require a down payment. Otherwise this will keep happening.
First off, "millions and millions" is inaccurate.
The people who took out the loans expected to be able to ride an inflated housing market indefinitely without doing the hard math and answering the hard questions....the number one question being, "Can I still pay this loan if I suddenly lose my job or do I have some stop gap measures in place in case the unthinkable happens? Is this home actually worth what the asking price is? Can I afford to live here if the market suddenly turns upside down?
I think the market needs to be allowed to work itself out. That means it is not going to be pleasant and some people are going to get hit pretty hard, however, it's the best way. Implementing government fixes, controls and interference, will only make the problem worse and more costly. I also think that givernment needs to stay the hell out of the mortgage business and let lenders lend money based on good old fashioned common sense. That means lending strictly by the numbers and the ability for the applicant to repay the loan and no lending to people who clearly cannot manage it
The BANKS OWN THOSE HOUSES THAT ARE BEING FORECLOSED. They can do anything they like to loose the least amount of money. It is their throats, not yours if you had bought more than you could actually afford. I for one have a second mortgage on our house, after paying it off once. The second mortgage is to start a business. I should not have to be penalized for living within my own means and sacrificing while some one else took a loan out way too big and lived beyond their means. True, some have actually lost their jobs and such, those are the people I feel sorry for, not the others who knew, and signed the dotted line anyways. For those who have lost their jobs, the States do have programs to get them back on their feet already.
I think that is a great idea but we will still pay for it. In the form of lower intrest rates on savings and higher intrest rate on other loans. I do think the banks need to suffer as it is partly there fault for giving out high risk loans. The people should also be savy enough to know what they are getting them selves into. They had the chance to read the fine print on there loan papers bafore they bought the house.
We need more government housing since it is our government who has allowed this to happen. What is the one thing that affects everyone on the planet? Crude oil. When Kissinger told Iran and Iraq we would buy our oil from them if they used the USD as the denomination and that they paid off our debt with a portion of the profits he signed this countries unavoidable demise. Now we are trying to pay for a $9 TRILLION debt at the pump and with the price of crude at $143/barrel it's only going to get worse from here. If you don't see how this relates - crude oil affects everyone and everything. And we are not in an energy crisis in the way some would like you to believe as there is enough oil and natural gas in Alaska to sustain the US by itself for 200 years - yes that means the oil field on the northern slope is a large as the fields in Iran and Iraq.
Yes they should.
My wife tried hard to get me to accept a variable rate mortgage and a home.
I refused , we rented a home instead.
She is thankful to me now , and is not so quick to think I am being jaded or pessimistic.
I am now looking at homes , and may purchase a foreclosed home , at the expense of the people who tried to live beyond their means.
Thank you for using Yahoo answers , and have a great day !
The banks are only trying to recoup their loss on the homes. Example $200,000.00 Home. Outstanding loan amount $100,000.00 The bank "Breaks even" if they sell for anything above $100,000.00.
