Artful Dodger: It's just a game of tit for tat to both sides it appears.

One thing that gets me... wouldn't the installation of anti missile mini gun systems (such as they use on ships) cut down on the incoming ordinance?

... Or is the joy of eye for eye on both sides taken over.

Czuch: spare room is clean and ready for occupation <:)

Bernice: Sounds great, I hope you have a spare room for me, I will be there for a christmas spa!

Czuch: the house was in great condition, it had been transported from another suburb and had been renovated to a very high standard, newly painted, new carpets etc. I have this year had a new kitchen installed as the old one was a bit dated and also I have added another room on. In 1996 I had the house fully insulated and cladded and also had all the concrete driveways put down. The inside has been painted because after 13 years it needed it. Everything was paid for with cash money and as you know MONEY TALKS, so I was able to get some good deals. Also the floors were varnished as the carpets were getting worn. I have also installed a spa, which is great in the summer, it can also be used in the winter but I havent used it. The spa was 2nd hand but in fabulous condition so I got a great deal on it :).

Bernice: I agree, I dont think you should buy anything that you dont have the cash up front for, the exception probably a car, but I dont even know about that, and a house. But paying cash for a house, thats awesome, congrats on that one, except I am sure there has to be something about it that wasnt ideal, if you know what I mean?

Anyway, thats the down side, that you always need a house to live in, and when you sell your house for double the cost or whatever, you still have to buy a new one at the current rates, so it does us no good, really unless we only need less of a house or we move to a cheaper area, or like me, you have two and you can sell one when the value gets up there!

Czuch: I paid cash for my home in 1995.....it has increased in value 300%+ in the last 13 years but has stabilised at the moment.....now would be the time for me to sell BUT what can I get for the money....not very much, at least not as nice and comfortable and well equipped as the one I have.

***edit*** also the interest rates are still too high over here ....no one will buy when interest rates are about 7%, they might buy if it goes down to about 3%, but the safest way is the way I did it.....PAY CASH

Czuch: It's not something I'd take as a certainty until governments stop this boom and bust system.

(V): you might be surprised... a house bought for 200k last year might not be worth 400k in 9 years, but its likely to be worth 800k in 19 years, and is probably going to be worth at least 1.6 million in 29ears, and my guess is that the house you buy next year will be 5 times in 19 years!

Czuch: Possibly.. but not for the owners of today. In the end it is determined by how long this 'depression' goes on for and how long the recovery period is.

Plus prices are likely to fall more before rising. We are at the start not the end of this economic down turn.

Tuesday: Renting is a great option for many people, and the only option for many right now....


when I lived in Hawaii, we paid over 100k in rent over 7 years, we paid for some guys house who wasnt even in the state, and thats when i decided that guy should be me, but you are right, the flexibility renting givessomeone is worth it to many people!

Artful Dodger: Well, like vikes said, arms arent really disigned for people who are going to keep them for a long period of time, but people were stupid, and people who could not afford and should not have been buying were buying anyway because they got false hope from temporary low interest rates.

Also again, there were people like me, who can afford to purchase, but am self employed and had at the time a poor credit history,these sub primes were perfect choices, and I knew going in that i had 2 years to refinance or i would get pounded, and I did that... but with your regulations, no bank would have ever even considered giving me a loan, and now my credit is so good, they beg me to take out more!

(V): I think if you buy a house today, at the discounted prices, its very likely that your house will more than double in the next 10 years!

Czuch: It's dependent on certain %'s being true for the whole period. It's no guarantee... I don't think those with houses now think their houses are going to double in price.

Artful Dodger: I think it's a case of people getting loans with an ARM that haven't the credit rating or a good enough deal to get the 30 year at a good rate, they probable shouldn't have bought the house in the first place.
about the people defaulting, it's a combination of people that were flipping and got caught in the bubble, people that have lost their jobs or people that their value has dropped and it makes more sense to just let it default, their are more reasons but these are the big 3, usually people telling their personal story on a news/commentary show aren't telling the full story

Artful Dodger: first, i believe that points are a one time thing determined at closing, its only the interest that will change, and if there are people defaulting on arms right now, I would have to assume its nothing to do with interest rates, since those are way down, but the fact that these people have either lost their income or they really couldnt afford the loans no matter the rates?

(V): No, that is an average, no matter the conditions... yes sometimes it will not be true but other times it will be even higher! But it still is a good general rule of thumb!

BTW, this is a great time to purchase real estate, low prices and low interest rates, in 5 years from now you will be kicking yourself wondering why you didnt buy something right now!

Artful Dodger: Those are current rates for a new loan, but the people in default now are likely in loans 2 or 3 or more years old...

Czuch: Home prices do not double every ten years, that is only in an economy that has no recessions or depressions... And from what I learnt from economic classes and from watching the worlds economy over the last 20++ years no economy is without down periods.

Artful Dodger: oh that's right, you are an educator , seriously tho, and ARM is just a tool, as Czuch points out a long term buyer wants the stability of a fixed rate at a higher rate, it will be lower than an ARM in the long run while someone who will be in their house a short time or is flipping the house would be better suited with the ARM.
While banks should make this clear, it's not their fault that many people are not savvy about finances
Also remember that most lenders bundle and sell off loans and don't get hurt by people that default

Home values double about every 10 years, so you buy a 200k house now, in 30 years it worth 1.6 million, who cares if you have not payed even one penny towards the principle, and you still owe the full 200k after the 30 years, you still have done alright and your payments were a few hundred dollars less every month, that pays for your car or whatever!

Vikings: They recon house prices here will fall possibly by upto 30%

Artful Dodger: Like vikes said, some people arent in their house very long, and want as low a payment as they can get, an arm gives them that lower rate and they are out of their house before it adjusts up.

Opposite with interest only... you are planning on being in the house for 30 years, you want as small apyment as possible, and you dont care about creating equity except that what you will get from your value going up over 30 years

Artful Dodger: So when I see someone on tv today telling me they are losing their home because of their arm, they are just lying, because rates right now are at all time lows and anyone with an arm is actually paying less now than when they bought the loan in the first case!

Czuch: Another factor in the interest rates is the equity to loan value, that is to say that if you have 20 percent equity in your home then you will pay a lower interest rate than if you have 5 percent,
another casualty of the bubble

Vikings: I agree, just because something is available does not make it the right way to go. Some people, an interest only loan is good, if you want low payments and dont care about equity, an arm may be good if you dont plan on having it too long or if you think rates are on the way down


I can agree with regulations that guarantee full discloser, not just in the fine print... but thats why we use mortgage brokers and dont just do to a bank ourselves looking for a loan. But a good broker will give you all the angles before they sell you a loan,and they should be required to as well

(V): That is a legitamit problem, a casualty of the market bubble that fortunately is hitting the high end homes more than the mid-low end homes

Artful Dodger: but dont interest rates of an arm go down when rates are low like now?

Artful Dodger: Thats not the fault of the Arm, Why didn't she simply refinance to a 30 year, she sure should be smart enough to know that going in, oh that'sright, you said she was in education, that explains it, .
But seriously, An ARM is nothing more that a tool like a credit card it has to be used wisely, And unfortunately many people are not smart about finances

Czuch: It's not just that Czuch... But home owners (at least over here) are facing a negative equity problem where their house is worth less then what they paid for it.

Not good.

Artful Dodger: maybe i dont understand, but doesnt an arm mean that their rates adjust with the current rates? If so, with and arm their rates should actually be going down, if not at least where they started when they took the loan (maybe they can only go up but not down with the current rate?)

Artful Dodger: Of course the banking system needs regulating, not only that but all parts of the financial system. I mean.... I use to run a P/L dept and we had auditors every year.

But... governments have been quite happy to leave them as they are as it helps in the ol boom and bust economic policies that we've had to put up with.

... Maybe a ban on our governments using the B&B system would also be helpful.

Artful Dodger: I had an arm to purchase my first real estate, also no money down and no documents as well... I got 2 years of payment history and then refied into traditional 30 year with equity as a 20% down payment.

Point is, the sub prime worked for me, without it I would still be a renter, instead I now have an apartment building that pays for itself and a 3 br 2 1/2 bath home in the country with 2.6 acres (also bought with no money down)

anyway, not for everybody, and people have to make sure it works for them, be smart, but they do work for some people!

Artful Dodger: There is a good use for ARMs, one example is the bussiness man that transfers frequently but still wants to have his family live in a house, ARMs save that person a lot of money. It's the quotas that were pushed on the banks by the likes of ACORN that caused the trouble

Why not part of the banks bail out is that they have to loan money to the cars, one bail out two winners!

Tuesday: there is NO reason that it should not be returned...that is ridiculious to allow them to piss it away like that!
The auto industry...look at how many jobs would have been effected by the ripple effect of them going under......EVERYONE should be made to give up...EVERYONE...from the CEO's to the lineworkers.....I know,ohhh boo-hoo me...I have to give up $10.00 an hour (or what ever,just throwing a number out there) but lets see....$35.00 VERSUS ZERO cuz ya have no job! And it should be lower then THAT even...the guys in the military,cops,people like THAT deserve to make the big bucks,NOT someone standing for 8 hours a day gluing 2 pieces of plastic together!!

Tuesday: right..which is why when they atarted doing that stuff with OUR money,they should have had the money taken right back from them.....WHY GIVE to them...why not lend to them as well?

Artful Dodger: thats because they get bonuses for making those loans and then they sell them off, a win-win for those banks

Artful Dodger: Nahhh I was merely commentating on how O'Reilly a confirmed republican suddenly left the party to look good for TV.

I wouldn't compare myself to O'Reilly... He's not always truthful. And the rest..... Well.

Czuch: I think the banks should NOT have been bailed out...the auto industry,yep,loaned money is good.....I have head a TON of "conditions" with this money going to the auto industry..but honestly,when they gave the money to the banks....I didn't hear of any conditions.....where there any and I just missed them on the biased news that I watch??

Artful Dodger: Gee Art, did you think us *cough**cough* independents (as O'Reilly likes to call himself ) don't agree always with the Pres, even if he is a republican.....

.... And It's not George that's wanting this is it amongst your government.

who gaves in to the car giants

http://www.bbc.co.uk/go/homepage/d/int/news/top/1/-/news/1/hi/uk/7793137.stm

Artful Dodger: You might be on to something

http://www.youtube.com/watch?v=CKmzGPIx4YQ

"BMW's UK sales were down 41% in November. Mercedes were down 57%. "