Bump this thread every time Trump makes America greaterest again - Page 4 - Politics and Economics

One benefit of PMI is that most people will keep paying their mortgage even if they are underwater. Further, a 3% down payment actually is meaningful to many PMI borrowers - they have to try really hard to save up $6k or whatever, and even if they "should" bail if the market turns, they want to protect that initial investment.

You do understand that if the market turns you can't just "bail" right? Let's say you owe $200,000 on a house that sells for $100,000 at a foreclosure auction when you "bail" the lender can and will in most cases sue you for the $100,000 you still owe that they didn't recover. They will then attempt to garnish your paycheck, levy your bank account or put a lien on any real assets you have going forward.

For the record I am pro PMI but your post shows a complete understanding of the system.

01-23-2017 , 11:51 PM

#77

iron81

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When the bank foreclosed on the condo me and my sister owned, a deficiency judgment of around $70k was entered against us. They made no attempt to collect that judgement and I believe such attempts are rare. Also, some states don't allow deficiency judgements.

01-24-2017 , 12:01 AM

#78

Bigoldnit

veteran

Join Date: Sep 2010 Posts: 2,397

Yeah, it's state by state. Some states require that residential mortgages are "nonrecourse" (meaning that they can't come after you personally for any deficiency). Also, iirc, deficiency judgments can be discharged in bankruptcy...

01-24-2017 , 07:34 PM

#79

TeflonDawg

Pooh-Bah

Join Date: Oct 2006 Posts: 5,931

Quote:

Originally Posted by jt217

I don't know, like, maybe the fact that it's wrong?

Please do everyone a favor and not post if you're going to input a non-answer to a question. You're wasting yours, mine, and everyone else's time when you do so.

Quote:

Originally Posted by Namath12

Let's say you have a married couple each earning $30k per year. They are renters, and their rent on a 2BR/2BA in a middle class apartment complex is $1,000 per month. This is easily affordable to them; they have never been late on their rent even once. Their lease is up for renewal and the landlord, citing the current rental market in their area, will increase their rent to $1,150 per month if they renew. They decide that, though they could afford the increase in rent, they would rather own a home.

They find a home that suits them for $160,000. They manage to negotiate the price down to $150,000 as the seller is moving out of state and is motivated to move the property quickly. They don't have a lot in savings (like most people in their income bracket) but they are able to scrape together $7,500 to use as a down payment. They will finance the remaining $142,500. Since they are financing 95% of the purchase price, their FICO scores are around 730 and they've secured a 30-year mortgage at an interest rate of 4.25%, and their property taxes come to roughly 1.25%, they will have to pay PMI at a rate of 0.62%. Their homeowner's insurance premiums will run them roughly $1,000 per year and will be added to their monthly mortgage payment.

After all of these are factored in, their payment comes to $1,015 per month. This is slightly more than they are currently paying in rent, but substantially less than they would be paying monthly to renew their lease and stay in the same apartment (which would be $1,150 as noted above).

If they were forced to put 20% down, they would need to come up with $30,000 cash, otherwise they could not buy the home. Period©. Again, like most people in their situation, they simply do not have that kind of liquidity lying around.

Now, we can debate the merits of letting this couple get by with a 5% down payment v. requiring 20% or NO HOUSE FOR YOU, and that's a fine and worthy debate. But given the numbers above (which you can verify for yourself with any free online mortgage calculation tool) the blanket assertion that "if they can't afford 20% down they can't afford the house" is just plain ludicrous.

Thank you.

01-24-2017 , 07:45 PM

#80

Riverman

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Quote:

Originally Posted by WichitaDM

Yeah save the consedcention. In many states mortgages are non-recourse by law.

01-25-2017 , 11:19 AM

#81

DudeImBetter

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Trump gonna build the wall in his quest to MAGA

https://www.google.com/amp/mobile.ny...android-att-us

01-25-2017 , 01:17 PM

#82

RollWave

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Dow > 20k

Trump Bump

01-25-2017 , 02:27 PM

#83

Ineedaride2

Politics Court Jester

Join Date: Oct 2005 Posts: 25,080

Quote:

Originally Posted by Paul D

No. A reasonable well thought out argument is... https://www.youtube.com/watch?v=Yh6r3I821ng or actual academic research. Kato just regurgitated something he heard he thought made sense.

And congrats on circle jerking with your bros rtd353 lol

Cuz, that ****'s an hour and 18 minutes.

01-25-2017 , 02:34 PM

#84

Ineedaride2

Politics Court Jester

Join Date: Oct 2005 Posts: 25,080

Quote:

Originally Posted by Namath12

This is a good post, and although I'm a fan of healthy down payments (old school I guess), there is no doubt that renting makes it tough to quickly accumulate extra cash or collateral.

With that said, I think a lot of people under-estimate the additional costs owning homes incur as opposed to renting, and I'm not just talking about property taxes and insurance. General maintenance bills alone can get big in a hurry. This really has ****-all to do with down payments, but I'd imagine that the "other" costs involved in home buying has broken a ton of people who were walking the line in making their mortgage payments.

01-25-2017 , 02:35 PM

#85

Namath12

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Quote:

Originally Posted by Namath12

looooooooooooool dumbest thing I've heard in a few hours

Just want to publicly apologize to Kato for this, it was much harsher than it should have been and does nothing to further honest discourse.

01-25-2017 , 02:40 PM

#86

Jiggymike

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Quote:

Originally Posted by RollWave

Dow > 20k

Trump Bump

All that matters; 10k points of growth or so under Obama quickly forgotten if it was ever even acknowledged.

01-25-2017 , 02:44 PM

#87

Namath12

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Quote:

Originally Posted by Jiggymike

All that matters; 10k points of growth or so under Obama quickly forgotten if it was ever even acknowledged.

Yeah, ye olde "historically-low-interest-rates-driving-investors-to-Wall-Street" argument now resides in the memory hole

01-25-2017 , 02:51 PM

#88

Namath12

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Speaking of memory holes

https://www.theguardian.com/commenti...ne-conway-1984

Quote:

Since Kellyanne Conway spoke of ‘alternative facts’, Nineteen Eighty-Four has hit the No 1 spot in Amazon’s book sales chart.

TRUMP reviving the publishing industry! Jerbs!

01-25-2017 , 03:01 PM

#89

revots33

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Took down the Spanish-language portion of the white house web site. English-only in 'Murica, bitches!

http://www.foxnews.com/us/2017/01/23...e-content.html

01-25-2017 , 05:55 PM

#90

kerowo

lolcat

Join Date: Nov 2005 Posts: 37,190

Quote:

Originally Posted by Ineedaride2

I don't disagree, but this sounds like it's equally the responsibility of the lender as the homeowner.

01-25-2017 , 06:09 PM

#91

2/325Falcon

Conehead

Join Date: Aug 2005 Posts: 21,907

The bank isn't responsible for telling first time home buyers they need to buy a lawnmower and a snowblower and there's no landlord to call when the washer ****s the bed or the roof leaks.

01-25-2017 , 09:12 PM

#92

WichitaDM

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Quote:

Originally Posted by Riverman

Yeah save the consedcention. In many states mortgages are non-recourse by law.

Ya man 11 whole states. You really got me good...

01-25-2017 , 09:20 PM

#93

Riverman

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Well, on top of that banks don't pursue defaulting borrowers in the others, because they are all ****ing broke. And they are broke because the mortgage is the last thing they don't pay.

01-25-2017 , 10:21 PM

#94

kerowo

lolcat

Join Date: Nov 2005 Posts: 37,190

Quote:

Originally Posted by 2/325Falcon

The bank isn't responsible for telling first time home buyers they need to buy a lawnmower and a snowblower and there's no landlord to call when the washer ****s the bed or the roof leaks.

Go Capitalism Go!

01-26-2017 , 11:18 AM

#95

RollWave

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Quote:

Originally Posted by 2/325Falcon

The bank isn't responsible for telling first time home buyers they need to buy a lawnmower and a snowblower and there's no landlord to call when the washer ****s the bed or the roof leaks.

and yet they usually do that sort of thing (at least make those types of educational resources available) because they want their borrowers to be knowledgeable enough to make smart financial decisions so they actually pay the mortgage on time every month.

Google "bank of america first time home buyer tips" or replace bank of america with any other lending agency and you'll find that in fact pretty much all of them do intentionally make all sorts of information available to educate people on what they are getting into.

(though much of this is also just clickbait to get traffic to their website to gain new customers)

01-26-2017 , 11:35 AM

#96

Hammerin Hank

grinder

Join Date: May 2012 Posts: 594

BUMP

The country has the audacity to control it's borders and the stock market is back in an uptrend.

01-26-2017 , 12:46 PM

#97

Jiggymike

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Quote:

Originally Posted by Hammerin Hank

BUMP

The country has the audacity to control it's borders and the stock market is back in an uptrend.

Yeah building a big border wall to help Hank sleep at night instead of investing that money into infrastructure, research, or education is just the greaterest.

01-26-2017 , 01:33 PM

#98

Hammerin Hank

grinder

Join Date: May 2012 Posts: 594

It's not just about the wall. It's about controlling illegal immigration, something that most every country in the world does, and has bipartisan support in the polls. I sleep fine thank-you, even here in sunny California.