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Posted by Todd Wilson on Friday, December 07, 2007 at 15:58:38 :
In Reply to: "Real banks aren't in foreclosure trouble"? posted by David Sherman on Friday, December 07, 2007 at 12:11:06 :
I guess my idea of a real bank isnt what everyone thinks is a real bank. I kinda think of different places as a real bank or a lender. Does citibank have actual places to go like walk in and drive up teller windows and check book bank statements every month?
I get junk mail all the time from citibank,Wells Fargo and all the others wanting me to borrow money or get a credit card. I dont ever get anything from my "real bank" that I have my checking account with in town here. If I want a loan I go to them and we talk.
If I had walked into my "real bank" and wanted to borrow 400g's to buy a house I clearly could not afford they would have told me to leave. I could have then went to what I call a "lender" and got one of these stupid interest only loans or special loans and went ahead and bought the 400g house. When I bought my house 10 years ago I was told at the time that for every 10000$ your house cost plan to spend about 100$ in payment. 40000$ will cost you 400$ a month for 30 years. 400g house cost you 4000$ a month for 30 years. Some of these fly by night lenders are loaning 400g's for a very small payment per month. I think lots of people have done this and then lost their jobs. This has left the "lenders" with foreclosure on lots of property and then values have also dropped and now the 400g house is worth 350g's. I also see people who buy more home then they can afford. They dont get the insurance and taxes added into their monthly payment and suddenly they are living in a fancy house for a small payment and then at the end of the year when the fat property tax is due or the insurance is due they dont have the cash to pay and get in trouble there.
One question I do have is how are the lenders in such trouble with forclosures? I had and still am paying mortgage insurance on my house until I get a certain amount paid off. WHy arent these mortgage insurance outfits taking care of things?
Todd
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