Saturday, November 17, 2007

Mortgages

At one time in my life, I was a loan officer. When I was sick, my good friend Glen took me under his wing at his mortgage company, allowed me to work to collect insurance. God bless him, I don't know what would have happened if he didn't. In ALL of my dealings with poeple, I steered them away from the adjustable rate mortgage. Why? At the time of my being in the business, rates were historically low. Unbelievably low. I refinanced my house at about 5 1/4 percent. I knew that if the rates were historically low, they weren't going to go much lower, only higher. My line was, "you'll love me now but in five years, you'll hate my guts." I wanted their business again and in order to that, I was completely honest. Some didn't listen, some did. Those who did are still paying about 5 1/2% and are building some decent equity. Those who didn't are probably in the throes of foreclosure. I feel very strongly about this...when dealing with something as important as your biggest expense ever, ya might want to do a little background work to a) find a reputable lender and b) read the doggone fine print. I feel bad for those who have put themselves in this position but buying a house with no down payment or buying too much of a house is entirely their fault. What would our parents have done? Probably buy a starter house, (or, what we did which was rent until we could afford a house we liked) then when you have the down payment saved, finding a house you can afford. But no, not this generation. It reminds me of an old Queen song "I want it all and I want it now!" About five years ago, there was a massive building boom around my house when all these Mcmansions went up. I thought to myself, who is buying all of these expensive houses? Five years later, 70% of them have for sale signs up. Now I know who was buying them...people who couldn't afford them.

2 comments:

Matt said...

Amen to that, brother. I work as a physician at an Urgent Care, and it still amazes me the folks who come in having had typical cold symptoms for one to two days and want an antibiotic(which of course won't work) so they can be well NOW. (oh yeah, and they haven't tried any cold/symptom relief meds) - We are definitely living in the NOW generation.

karlene's mom said...

Wow! You hit it on the head. We are one of the FEW original families in my subdivision. We had a down payment, did a FIXED mortgage and refinanced at the record lows to pay more on the HOUSE and less on interest. People around me are double mortgaged, near bankrupt, and a complete mess... and there are many others who knocked us for buying one of the smaller homes built in our subdivision because it was what we could AFFORD. Crazy stuff. For sale signs everywhere, people "confused" - living in homes they can't afford. It's insane! And, these are all people from my "generation" - it's hard to claim them.

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