Are they ashamed to rent? Why can't they wait until they are financially stable and ready before they purchase? Why do so many refuse to leave when they are evicted?
2007-05-09 10:33:19 · 6 answers · asked by LAgirl 3 in Business & Finance ➔ Renting & Real Estate
It's very simple. I encounter this several times a week, as a real estate broker. You would not believe how often we get a foreclosure listing, perhaps to be marketed at $230,000 and discover that the FIRST mortgage is for $248,000, followed by a second mortgage of over $50,000. In this era of not so rapidly rising property values, people find themselves making payments on properties which are worth far less than the mortgages they are retiring.
We can look to 125% financing and less than honest appraisers as a source of some of the blame.
Why don't they leave ? They haven't taken the time to find another place to live, and somehow think that the lender will be merciful. WRONG !
2007-05-09 10:45:59 · answer #1 · answered by acermill 7 · 2⤊ 0⤋
Exotic lending. Option ARMS. negative amortization loans, interest only etc. They often do not realize the consequences of the type of loan they obtain.
Many lenders were also approving what is called a ZAP loan (zero ability to pay). They approved people for loans knowing that they would default. The lenders would then repossess the house and sell it on the market for more than the last sales price. Many lenders are now in trouble because too many of those homes have defaulted at once and they can't sell their inventory.
2007-05-09 18:05:13 · answer #2 · answered by Anonymous · 2⤊ 0⤋
Call it high ambition or greed. First time home buyers especially buy as much as they can qualify for as long as they can meet the payments. My philosophy is to buy the cheapest home you are willing to live in. 18 years ago, I bought a town house because I was working all of the time. I paid off the mortgage in four years. It has been so long since I made a mortgage payment, I cannot remember how painful it was.
2007-05-09 17:57:33 · answer #3 · answered by regerugged 7 · 2⤊ 0⤋
A lot of people were offered flexible loans and rates when the mortgage was really high. Now that the interested rate is fluctating and the mortgage payment is a lot higher and they can't afford it. You're right though people should wait until they are more financially stable and rent until they can afford to purchase.
2007-05-09 17:42:13 · answer #4 · answered by B D 4 · 2⤊ 2⤋
NO they are not ashamed to rent. And so many people are losing their homes because there are so any mis leading loan officers out their putting people in wrong loan programs. But, now that all of this has happened with the market now it will weed out all of the loan officers that don't really know what they are doing! It's just sad that so many people had to pay for there mistakes!
2007-05-09 17:44:53 · answer #5 · answered by yolandajdukes 2 · 3⤊ 1⤋
First of all, if you have a mortgage it is not your house that you are losing, it is the bank's house.
Why do they refuse to leave? Because they can stay for free for six months to a year, dragging out the eviction process and not making any payments in the meantime. A lot of them have crappy credit anyway, a foreclosure isn't going to hurt them, only the bank.
2007-05-09 17:59:26 · answer #6 · answered by Cardinal Rule 3 · 0⤊ 2⤋