I was gonna tell ya that you should not make comments about this subject until you were out of diapers...then you post the above. It is mostly correct. Mortgage brokers sold the loan to places such as Countrywide, and various other Mortgage companies. The Mortgage companys were the dumbasses who bought the loans without due dilligence. The brokers are the crooks who made out like bandits. I dont really understand how the whole process works, and have yet to see anyone explain it with certain amount of authority.

One thing I do know...The house next to mine sold new at 185k five years ago. They now want 385k. I told an agent it was not worth more than 230k. She replied that someone had taken out a mortgage on it for 350k...and defaulted. The whole thing stinks. Someone educate me...

I agree with someone earlier who said "why should I pay to bail there asses out, when I was not gonna see any profits?"

 

How is it affecting you? Dont you live with your parents?

 

I'm a realtor, except I'm doing landscaping since the market is so slow. Yes, I'm still living with my parents, college is 2 minutes away from the house so why move out? I'm waiting to see what's going to happen with this market and slowly saving money towards my home purchase.

 

Your logic is flawed on this one if I'm reading this like I think you mean it. The gov't can't bail the dumb ones out and help the people smart enough to spend wisely. By bailing them out in any way they are hurting the smart ones worse by ENABLING the dumb ones!! The tards who overspent are the ones hurting the rest of us. The Gov't has nothing to do with it and is making it worse in the long run for the rest of us. A bail out is a quick fix for a problem not a solution.

 

Very smart!! You are in a great position. House prices will cont to drop; we haven't seen the worst of the foreclosure bit yet. The market will readjust itself and will probably take a couple of years. It is going to be harder to get a mortgage, but if you have 20% to put down and a good FICO score you'll be ok. Or you could just wait 5+ yrs and everyone will forget about this whole thing and will be on the house boom band wagon again.

 

That is a very smart assessment s2krn. My fiance and I are in the middle of looking for our first home and are seeing the same things here in the Twin Cities. Though not as drastic as places like Florida and California. The Twin Cities just got a classification as a declining market from Suntrust. We have family who are mortgage brokers who work for Prime now. They used to work (just started with prime) for themselves. During the whole "sign the dead up" spree they refused to make these deals that everyone else was doing because they thought it was morally wrong. Thus they didn't make the money everyone else was and it closed down their company. Thus the reason to start working at Prime. Two of them also work at Countrywide and guarantee that Countrywide will be belly up by the end of the year. They've been firing people like crazy their and the default % is going through the roof.

That being said, we're continuing to wait. While I've been told by family in the mortgage business (and it makes sense by what I read), mortgages will get harder to get approved for and FICO scores will have a lot more to do with approvals now. Granted our scores are very good, so I'm not too worried about that part.

Here in the Twin Cities, Minnesota, the market is a little different because it bottoms out each year in February (middle of winter) and prices are softest and at their lowest. While I don't see the market getting any better in 08, I'm thinking we'd be in a better position to negotiate a lower price in the winter.

It's a great time to be a buyer with good credit, cash, and nothing pushing you to buy.

 

My wife and I bought last year in Feb and got a good deal on our house in Arkansas. We moved from Dallas after renting for 2+ yrs to save for our house. Sure we could have gotten a better deal if we had waited, but we were ready to move and buy. You can't "wait for the best deal" bc you will never buy . Who is to say what the best deal is. You pay what you think is fair and can't look back. Don't buy thinking of it as an investment (upfront at least) and plan on staying put for a while. I'd hate to know what my house would sell for right now, but it doesn't matter bc I'm not selling. Good luck with the house purchase in Feb. You're right about your position... it is one of power when you know you don't have to buy!

 

That's another good point because you can drive yourself crazy always looking for the best deal. Because you're right, you a better deal could come at any time but then again it could get better at any time. The house thing isn't like a car or pair of shoes and not for the obvious reason of cost. But rather it's a life choice and something you want to be very happy with.

Our wedding isn't until August and we're trying not to live together until then. Some consider it old fashion but it's what we're shooting for. We've found some excellent homes in our price range but we keep getting hung up on location. That being it ends up being a corner not or a neighbor's back yard backs up to what would be our side yard.

 

Completely different beasts, don't try to put words in my mouth.

 

I can tell you not to settle. If it means renting for a little while longer that just means you have more money saved for the house you want. First of all buy something you can afford... Not what they tell you you can afford. Sit down and work out a budget. Look at your finances all the way down to the starbucks receipts and try to keep your house note less than 1/3 of your take home pay. It's easy for me to say this being in an "affordadble" housing market; it's not so easy in tougher markets. Anyway, look at your car payments, cell phone, etc and realize you will have to pay property tax and Mortgage Insurance. There's more than a house payment there. DON'T SETTLE. Find something you both like. You may not be in such a commanding position again to buy a home.

 

Its funny you say that, we've created a spread sheet which combines our post tax income and every expense you described and more. That gives us a good idea of what everything would be like and what our savings could be. It really gave us a great idea of what kind of a house we could afford.

Her uncle the mortgage broker told us what we were approved for and said but said that there is no way we could really make payments on that and we aggreed. It was nearly $100,000 more then we could afford to make payments on. No wonder people are defaulting like crazy. If we were not smart enough to think about all our income and expenses we'd be hosed. Add a adjustable rate mortgage to that and I can see why all these people are defaulting.

The toughest part is not settling. We find these homes that we're 95% in love with and then something like that location bit happens and it ruins it and we move on. I'm sure something will be found though before June, so I'm not too worried. Worse case scenario prices firm up a little bit here by then and we just have to pay more. But we'll have a lot more saved by then too, so it's a give and take.

Thanks for the reassurement of the advice. That settling bit is the thing we've struggled with the most.

 

Shoot, double clicked the submit button. Ignore the repost.

 

NEVER settle on location. That is one thing you can't change. You can change countertops and floors and paint etc but unless you buy a trailer you are stuck. If you struggle over buying a place bc of location so will the person who is looking at it when you sell later. Don't buy a house with the intention of "building on" either; esp if you are on a fixed budget.

How eye opening was it when you made your spending spread sheet? A lot of money is spent on "wants" rather than needs. When you spell it all out it is pretty enlightening.

 

It was incredibly eye opening and we both realized our car payments were WAY too high. Sure we didn't think they were a big deal without a mortgage but add all that in and we realized the cars we're driving are way too nice for the houses we could afford. Granted it wasn't terribly bad and my truck is almost paid off now, but it still was not ideal.

One thing we've realized is that if it's been on the market a long time then it's usually for a reason and not a reason that's either fixable or easy to fix...regardless of the current market condition.