Problem also is that people are buying homes in economic uncertainty. The government wants us to believe that the recession is over and everything is fine. Hell, gas was down to almost $2 a gallon. Things must be great, right?
I bought my home a year ago. Put down a sizable down payment with very low interest rate and have a reasonable mortgage. But... a year ago I thought my job was secure, now we're being forewarned of cutbacks, layoffs etc. The number of businesses that have closed in Salisbury in just the last year is alarming and guess what? It's not going to improve. More businesses will close, people will move to find work and property values will plummet.
It used to be that home ownership was an asset and an investment. Not any more. If I could go back a year I'd rent and keep renting. No maintenance costs, taxes are the owners problem and if the neighborhood I'm in changes for the worse I can give notice and move, don't have to worry about unloading a house that was in a decent neighborhood when I bought it but now worth a third or even half what I paid for it.
You borrow $200K for a house at 4.5% and on a thirty year conventional mortgage you'll pay on average double the purchase price. I know how apr's work etc. but in its most simplistic form you're still technically paying 100% of the property value so when you sell...you're still "by the numbers" in the hole, have gained nothing and have paid to maintain that property for all those years. Let's not even get started on capital gains and taxes on the proceeds of your home sale despite already having been taxed on the income you used to buy the home.
The more you work, the more you own, the more the government will turn the thumbscrews.
Sorry, drifted off topic a little but my point was that not all foreclosures are a result of buying more house than the owner can afford, sub-prime loans and deadbeats simply walking away. Whatever the reason it affects the overall economy.
F it. Just walk away. Big business don't care about your struggles. Why care about them. They have no moral. Why should you. At the end of it all, you answer to the One and Only. Not the rich and infamous. I walked away and doing wonderful.
ReplyDeleteI would rather get a bargain even if it was during an uncertain economic time.The lower the monthly payment the easier it would be to scrape together.A monthly payment reduction of say $300 doesn't sound like a lot,but it's huge when a person has very little income due to a layoff or business closing.
ReplyDeleteBuy a house - the gubmint uses the transfer tax you pay to buy itself land and remove their land from the tax role; then your property taxes pay for the Educrats to dumb down the children; then the gubmint complains when you don't go to the casino and gamble enough.
ReplyDelete