Car Payment Box

[Wes Tausend]

...

Welcome to the era of the Patriot Act and all it's little siblings...

( http://content.hamptonroads.com/stor...037&ran=170893 )


...

[Ron61]

Ernie & Razor,

You make good points and now I understand what you were getting at. And in the cases you point out I can understand that the box would be a good thing. Maybe what I really don't understand is that if they think a persons credit is that bad, or like Razor stated, they have good income but won't make their payments, why loan to them in the first place. In the case of the airlines and other businesses suddenly shutting down, I really do feel for those people as that is beyond their control. That has happened several times on a much smaller scale right here in Redding it the past 4 months. And in one case one of the workers had just gotten a new car and now is trying to sell it. I don't know about your areas but around here I can only see it getting worse for some time to come before it finally bottoms out and starts to gain some.

Ron

[Don]

Has everyone always had a favorable experience when lending a substantial amount of money to a relative or close friend, w/o any documentation ?

[GlynMeek]

Dear god, Don...exactly the opposite. I have done it 4 times now, and NEVER been repaid on ANY of them!!!! After the first time, I just assumed it would eventually become a gift!

[4RE KLR]

Good Credit / bad credit / rich or poor, there is no way in hell I buy a car that has one of those ^%&$^@#& tracking boxes in it, in order to make the deal.

When I got finished giving those SOB's a piece of my mind they would know it! This is how it starts and we are too damned stupid to fight it off. What next a tax on the tax? Well, I am sure it also would be sold to us a being temporary, and for our benifit. MY ASS! It is crap that this that just boils my blood!

As far as credit goes, $hit HAPPENS, deal with and move on but don't chastise and label the folks for eternity. Most of these damn sub prime mortgage loans were made by crooked ass lenders to good people. The lenders lied and screwed these people and then the loans became sub prime. So you would punish some 60 year old man for the balance of his life because he was a victim and got phucked by a mortgage company? Shame on you!

It is exactly this mentality that is the reason the police go after the victims instead of the criminals. The victims are easier to catch.

GRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRrrrrrrrrrrrrrrrrr rrrrrrrrrrrrrrrrrr

[meat]

Originally Posted by Wes Tausend

Welcome to the era of the Patriot Act and all it's little siblings...

I don't think you can blame the Patriot Act for bad credit. That's like blaming mankind for the earth's eccentric orbit changing the climate.

Your pal,
Meat.

[427 S/O]

Correct Glyn, learned the hard lesson. Try to avoid loaning 'anything' to friends and family. Unless you know them to be 'standup' folks!.

[meat]

Originally Posted by 4RE KLR

Most of these damn sub prime mortgage loans were made by crooked ass lenders to good people. The lenders lied and screwed these people and then the loans became sub prime. So you would punish some 60 year old man for the balance of his life because he was a victim and got phucked by a mortgage company? Shame on you!

THAT'S patently untrue. Subprime mortgages were made because people were greedy and wanted more home than they could afford.

Yeah, I'd punish a 60 year old man who got a subprime loan; he didn't read the paperwork, and he couldn't be bothered to check with other borrowers to see what mortgages were available to him.

I sure as hell don't want to bail him out of his stupidity, either.

Your pal,
Meat.

[Don]

There needs to be an housing upgrade program for those that looked at the mansions and then purchased lower , or not at all, within their ability to pay, now and into the future.

[Ron61]

Don,

Agreed that would be nice but with the way things are going right now, how would you determine if in the future, even a few years, a person is still going to have a job or be able to make a certain level of payments. You also have to factor in that everything else is going to just keep going up and that will eat away their income too. Right now we are having a lot of complaints in this area about houses that have been foreclosed on being broken into and lived in by the homeless, which we don't have a lot of and the dopers which I think make up about 1/2 of our population. The city of Redding says they don't have the money to send code enforcement people to all these places and to write tickets to the banks and loan companies that now own the houses, to make them clean up homes that were nice and are now dumps. That is hurting the other home owners in those areas as it is lowering the value of their property and they have had two meetings with the city council about it so far with nothing resolved.

Ron

[Ron61]

Don,

Originally Posted by Don

Has everyone always had a favorable experience when lending a substantial amount of money to a relative or close friend, w/o any documentation ?

I was just reading this and thought that it fit right in with your above post.

Brother, Can You Spare $1,000?Thu Apr 3, 2:00 AM ET

DEAR MARGO: I have a history of being the banker of the family. My wife and I both do OK for a couple with no formal education. I was injured a couple of years ago, and even without my paycheck, God blessed us: I got a very large settlement. I'm on the verge of changing my numbers and not returning messages. Is this considered greedy or self-preservation? I would not think about doing this, except there is a long history of no calls or visits from our family members unless they have their hands out for loans (none paid back, by the way). There was never a "How ya doing?" or "Do y'all need anything?" I think I'm at the finish line of being a sucker and would like to go a different direction.

--- DADDY WARBUCKS NOW

Ron

[Wes Tausend]

Originally Posted by meat

I don't think you can blame the Patriot Act for bad credit. That's like blaming mankind for the earth's eccentric orbit changing the climate.

Your pal,
Meat.

..."blame the Patriot Act for bad credit"...?
Naw. I'm blaming the Patriot Act for misleading naming. Doublespeak or what is known as George Orwellian "Newspeak" ( http://en.wikipedia.org/wiki/Newspeak ).

Thinking that any black box that further degenerated individual rights might well have a "Newspeak" name to make it sound palatable, I Googled "car payment box". The ad link shown ( http://content.hamptonroads.com/stor...037&ran=170893) popped up referring to Norfolk’s Patriot Auto Sales which probably also has extensive use of the American flag in their lot. Good example of dazzling the public with good "mind-control" symbols and names while twisting the knife.

Nothing wrong with the American flag mind you, but I disdain the commercial overuse of it. Well maybe Perkins is OK.

..."blame the Patriot Act for bad credit"...?
Sheesh. Everyone knows that the climate is causing bad credit.


...

[Excaliber]

I do think the sub prime lending fiasco cuts both ways in that there was/is greed in the banking circles and greed on many of the home buyers side as well. There is no doubt some of the buyers were 'duped' by people were accustomed to trusting, bankers, financial advisers, etc. I don't support a 'bail out' UNLESS it is imperative to save our economy overall. That is the message I SEEM to be hearing from the Government, but I don't trust them anymore than I do bankers.

I learned years ago a bank will most certainly loan you more money than you WANT to borrow, not unlike a used car salesman with a black box. He knows he's getting the car back, he knows he's getting the house back, why worry. Sure, it helps a few people along the way, while screwing over twice that number. Whew, no easy way out of this one...

[trularin]

And they said George Orwell was a nut.

[392cobra]

U.S.News & World Report
The Housing Bust: a Statistical Portrait
Friday April 4, 2008
By Rick Newman

Economists will eventually write volumes to explain where the Great Housing Bust of 2008 came from. But for now, a few choice statistics do a pretty handy job. James Barth and several colleagues at the nonprofit Milken Institute have written a number of studies that plumb the causes of the subprime meltdown and the ensuing damage. Some data points that help depict what has happened:
Percentage of all mortgages bundled into securities, 1994: 55.8 percent; 2007: 74.2 percent

Percentage of all subprime mortgages packaged into securities, 1994: 31.6 percent; 2007: 92.8 percent

Percentage of mortgage originations that were subprime, 1994: 4.5 percent; 2006: 20.1 percent.

Increase in face value of subprime mortgages issued between 1994 and 2006: 1,700 percent

Share of mortgage originations by federally regulated savings institutions, 1987: 29.8 percent; 2006: 8 percent.

Share of mortgage originations by less -regulated mortgage brokers, 1987: 20 percent; 2006: 58 percent

Average annual rise in home-price value, 1990-1999: 3 percent; 2000-2006: 8.6 percent

U.S. homeownership rate, 1985: 63.5 percent; 2007: 68.2 percent

Ratio of the median home price to median household income, 1985: 3.2; 2006: 4.6

Household debt as a percentage of disposable income, 1985: 74.9 percent; 2006: 137 percent

Percentage of mortgage holders unable to tell if their loan includes an expanded "balloon payment," 2007: 30 percent

Percentage of mortgage holders unable to tell if their loan includes a prepayment penalty for refinancing within two years, 2007: 44 percent

Foreclosure rate on prime mortgages issued between January 1999 and July 2007: 2 percent; on subprime mortgages: 13.7 percent

Total cost of the savings and loan crisis of the 1980s, in 2007 dollars: $408 billion

Total estimated cost of the subprime crisis so far: $150 billion to $500 billion.

Note: All current figures are the latest available and may not refer to the entire calendar year.

Sources: Milken Institute; U.S. Census Bureau; Federal Reserve; Wholesale Access; 2007 Mortgage Market Statistical Annual; Inside Mortgage Finance; Office of Federal Housing Enterprise Oversight; Federal Trade Commission; LoanPerformance

[Don]

What still appears to be the bank's or mortgage company's lack of responsibility to the shareholders is to issue a mortgage with no money down, speculating that the escalation of real estate values would cover their risk exposure.

[Excaliber]

VERY telling that such a large percentage are unable to determine if their loan includes a ballon payment or an early refinance penalty. I know, I know, it's easy to say, "Well it's the borrowers fault, they should have read the fine print." But reality is, we tend to TRUST our financial advisors because the fine print is written in such gibberish and laywereze it's simply impractical for the average consumer to understand it. And the percentages of those unable to 'get it' BEAR THAT OUT.

The baby boom generation will be subject to one crafty 'scam' after another in the years to come and many GOOD PEOPLE will fall for them, as has happened to many good people all ready with the housing lender 'scams'.

Nope, you can't excuse peoples ignorance, but I won't be so quick to lay the blame on them either. Add to the list of professionals to be skeptical of: Used car salesman, politicians, police officers (sorry, but thats a fact), lawyers, real estate salespersons and now BANKERS and financial advisors.

[392cobra]

Boom to bust?
April 7, 2008


By Arnaud de Borchgrave -
Borrowing $2 billion to $3 billion a day from other countries to maintain the world's highest standard of living, based on conspicuous consumption, in an age of growing world shortages, while fighting two wars whose costs will soon ring up a $1 trillion tab, is tantamount to living on borrowed time.

Valium and Tylenol sales are up,Viagra down, in the banking world. So far, the subprime tsunami has wiped out half a trillion dollars from the books of major financial institutions in the U.S. and Europe.

At first, the Union Bank of Switzerland (UBS), one of the world's three most prestigious, figured it had lost $19 billion. That's when Singapore's pension fund kicked in $11 billion, figuring UBS was still a sound investment over the long haul. UBS then revised its loss estimate to $40 billion — for one bank!

As Congress debated clamps vs. band aids to stop the hemorrhaging, a downcast U.S. economy in recession became a tempting target for the world's 54 "Sovereign Wealth Funds (SWF)," a descriptive term for separate pools of government funds, mostly dollar surpluses accumulated from China to Japan to the Arab Gulf to Singapore. Instead of hoarding depreciating U.S. Treasury paper and dollars, SWFs invest in hard assets wherever they see opportunities in the world.

Foreign central banks keep looking for ways to unload stockpiles of dollars without disrupting their economies or the global financial system.

Edwin M. Truman, a senior fellow at the Petersen Institute in Washington, is the world's leading authority on SWFs. He estimates their total assets today at $5.3 trillion, about $1 trillion of it invested in the United States. The more financial trouble the U.S. finds itself in, the better the investment climate as U.S. business and financial entities decide to opt out into the arms of a foreign buyer rather than seek bankruptcy protection.

Treasury Secretary Henry Paulson's financial bailout plan got mixed reviews on Capitol Hill. Republicans, predictably, said too much government interference in free markets that should find their own bottom, and Democrats said, predictably, not enough. Their bipartisan compromise: a paltry $15 billion over the next 10 years in tax rebates chiefly for the housing industry. Meanwhile, the wrecking ball keeps swinging.

Over the weekend, Deutsche Bank said losses from "securitized" subprime mortgages were heading for $400 billion. Wall Street insiders said it would be more than half a trillion dollars.

The dollar is described as the leper at the birthday party. Fear of contagion is everywhere. So when Mr. Paulson said, "a strong dollar is in our nation's interest and should be based on economic fundamentals," he looked and sounded like Popeye desperately trying to find a can of spinach. But the magical powers of spinach can't stop the train this time.

According to the Bank for International Settlements (BIS) in Basel, Switzerland, another massive bubble that keeps ballooning is the derivatives market, which has quintupled in five years since 2002 to over $500 trillion — not billion.

Like the insurance industry, derivatives transfer risk from those who do not want to bear it to those who do — for a fee. Blamed for the market's phenomenal growth are (1) the Federal Reserve's cheap money policies that created the subprime-mortgage boom; (2) war budgets that strained the U.S. Treasury and future entitlement programs; (3) trade deficits with China and others that eroded the value of the dollar; (4) oil- and commodity-rich nations moving to equity payments — and the euro — rather than U.S. Treasury paper.

Fed interest cuts mean to the rest of the world that the Fed continues to print money at an alarming rate. Banks are borrowing from the Fed and then hoarding cash, apparently fearful the worst is yet to come. House prices are still falling — at the fastest rate on record.

The magnitude of the $500 trillion derivatives bubble is brought home by America's largest dollar figures: for GDP ($15 trillion); Federal budget ($3 trillion); U.S. government's maximum legal debt ($9 trillion). Also by the GDP for all nations ($50 trillion); total value of the world's stock and bond markets (more than $100 trillion). By way of reassurance, BIS' 2007 annual report also says the $11 trillion "gross market value provides a more accurate measure of the scale of financial risk transfer taking place in derivatives markets" every day.

A snapshot of what is actually happening is unfettered free market capitalism — and government spending. A blistering Government Accountability Office (GAO) report found 95 major defense weapons systems have far exceeded their original budgets by a total of almost $300 billion, bringing their total cost to $1.6 trillion.

A 22-year-old defense contractor, operating out of an unmarked office in Miami Beach, landed a $223 million Pentagon deal to supply surplus ammunition for the Afghan army. The ammo delivered was decomposing and made in China 40 years ago.

More serious in the field of mismanagement was the Air Force shipping to Taiwan in August 2006 four electronic fuses designed to trigger nuclear Minuteman III ballistic missiles — instead of batteries for utility helicopters listed on the waybill — and not discovering the mistake until 2008. In 2007, airmen from Minot Air Force Base in North Dakota accidentally ferried and lost track of six nuclear warheads flown on B-52 Stratofortress to Barksdale AFB in Louisiana.

This past week, government auditors discovered almost half of 28 contracts to manufacture body armor for Army soldiers were concluded without the product ever being tested.

Discipline and manners have given way to violence and rudeness. Foreign frequent travelers to the United States have noticed the polite greeting has been replaced by gruff questions. Many TV commercials depict violent or risky behavior in prime time. (e.g. Comcast-ic). Local TV news from coast to coast is mostly about local and national crime. The 10 and 11 p.m. crime roundups are presumably linked to sleep disorders for America's hardworking millions.

A return to the traditional values that made America the greatest country in the world is not a bad program for our next president.

Arnaud de Borchgrave is editor at large of The Washington Times and of United Press International.

[meat]

Originally Posted by Excaliber

Nope, you can't excuse peoples ignorance, but I won't be so quick to lay the blame on them either.

I absolutely will lay the blame exactly where it lays. Not only are that THOUSANDS of mortgage calculators available online where all you have to do is plug in your numbers and you'll get a pretty damned good idea of the amount of house you can buy, but they also sell calculators at Target and Walmart for $2.99 that do the exact same thing.

I'm also not buying that the number of foreclosures are going to affect the economy in any dramatic way, any moreso than the idiots who invested in air in the dotcom days did.

Your pal,
Meat.

[Excaliber]

I say a good share of the blame has to be accepted by the banks. Not that long ago I was offered a $500K loan on a house (strictly investment) from a lender based on my Declared income, that is NO PROOF of actual income, and a 100% financing. I actually considered the deal for a few days, BLOWN AWAY, the bank could be so generous. Luckily, I didn't go through with it, the whole consideration was based on 'greed' on my side AND there side. The loan officer would get his share, no matter what happened to the property down the road, why should he care?

As it turns out, it might have been a good investment after all, housing prices continue to rise here. Does that justify the deal? Would I be ready to sue the bank/lender if it all went bad? Would I have lost my primary residence? Tempting, very tempting to think of the possibilitys of winning vs failure. It's a trap, be careful out there.