Sad day for America
in [Toyota]
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From: Mike Hunter on 29 Mar 2010 14:59 What makes you think a 1984 Explorer, that actually came to market in July of 1983, is not a 25 year old model? Even if one only drove 15,000 mileage it would have nearly 400,000 miles on the odometer. Even a 1989 would have almost 325,000 miles. "Obveeus" <Obveeus(a)aol.com> wrote in message news:hoqori$7f4$1(a)news.eternal-september.org... > > "C. E. White" <cewhite3(a)mindspring.com> wrote: > >> "Obveeus" <Obveeus(a)aol.com> wrote in message >>> Ford makes the cars that people most wanted to get rid of. The fact >>> that many of them went back to Ford and said 'thank you sir, may I have >>> another', is a really sad commentary on American consumers. >> >> Most of the Fords that people got rid of were older SUVs. Since during >> the 90's Ford Explorers were by far the selling SUV is it any surpirse >> that they were one of the leading vehicles that were traded in? Six of >> the top ten vehicles traded in were old 12 to 16 year old Explorers. > > Yes...12 to 16 year old cars is a far cry from the claim that they were 25 > year old cars.
From: Mike Hunter on 29 Mar 2010 15:12 Of course you are correct. I stopped selling cars a long time ago and we sold just about every brand and the memory is the first thing to go. ;) Even a twenty year old vehicle will have 300,000 miles one it and Ford was selling around 400,000 Explorers a year. Go to trade any 20 year old vehicle, with 300K on the clock, and the value drops a grand. "C. E. White" <cewhite3(a)mindspring.com> wrote in message news:hoqln3$vcc$1(a)news.eternal-september.org... > > "Mike Hunter" <Mikehunt2(a)lycos,com> wrote in message > news:4bb0d047$0$19702$ce5e7886(a)news-radius.ptd.net... >> You are correct, but one the reason was Ford was selling around 400,000 >> Explorers, per year for around five years, during the mid eighties and >> they had been in service for nearly 20 to 25 years. The average mileage >> on them was close to 400,000, no wonder the owners purchased another >> Ford! > > Ford didn't start selling Explorer SUVs until 1990 (1991 Model year). > There were no (or at least very very few) Explorer SUVs in service for 20 > years when the cash for clunker program started. The most traded in > vehicle was a 1996 Ford Explorer. Which still says a lot about how > reliable Explorers were and how prolific they were. > > Ed >
From: Mike Hunter on 29 Mar 2010 15:25 Not so sure about ones intellectual level being the cause. A friend had one of his sons in California "Flipping" properties every six months and he was earning millions of dollars on high end properties. When the bubble broke he still got our OK with the few he still owned that he sold for less than he paid for them. He is retired and will never need to work again at age 44. What happened in California was their goofy environmental laws made it hard to build on a lot of the land there forcing up the price on the land one could build. Marginal properties that can be had for $250,000 elsewhere were priced at $2,500,000 in parts of California. When they changed hands a few years later the price we more like $4,000,00 He was selling properties more like $50,000,000 and up. Since he owned them, when he sold them, he didn't need to pay the 8% to 10% Realtors commission. "Obveeus" <Obveeus(a)aol.com> wrote in message news:hoqmkd$vnr$1(a)news.eternal-september.org... > > "SMS" <scharf.steven(a)geemail.com> wrote: >> On 29/03/10 5:47 AM, Obveeus wrote: >>> Apparently, many people think that the American citizen is not to blame >>> even >>> though the very root of the problem is that most people try to buy homes >>> at >>> the absolute limit of their purchasing capability...and once they do >>> that, >>> they keep spending money for phones, restaurant outings, HD TVs, etc... >>> instead of buckling down and living like paupers since they have chosen >>> to >>> sign away all of their income towards a house payment. >> >> This is true, but that's where regulation is needed because these people >> are easy prey for lenders that convinced them that they could afford >> these homes. > > Very few people go first to a lender to get advise on what they can > afford. Most home buyers are looking for and finding the home first, then > going to the lender and asking 'how do we make this happen'. In many > cases, the only way the lender can get them into that 'home of their > dreams' is with some backended mortgage with an ARM and/or balloon > payment. > >> A large proportion of the people losing their homes are not >> highly-educated, and they believed the hype of lenders, developers, and >> real estate people. > > I haven't seen any stats on education level of people that are currently > in foreclosure. Do you have a cite for that? > I would advise everyone to stay away from believing anything a new home > developer says, as they are about on par in honestly level as used car > salesmen. > I would advise everyone to stay away from taking financial advise from a > real estate agent says, as they are not particularly knowledgeable about > anything. > >>> 2. There should never again be a loan system where 'no proof of income' >>> borrowers are allowed to get loans unless they are forking over >>> something >>> like a 50% down payment (otherwise, those loans simply attract all the >>> liars >>> that deserve to be out in the street and hand them free housing). >> >> This is correct, but I expect that we won't learn any lessons, and this >> whole mess will happen again in the next major recession. Look what's >> happening now with all these bargain properties being snapped up by those >> that didn't get sucked into buying at the peak. They have the cash to buy >> houses in depressed areas, areas where banks are unlikely to lend (though >> by many accounts they should be waiting another six months for the next >> huge wave of foreclosures/short sales). When the market recovers and >> overheats they'll unload these properties and the process will start >> over. > > Yep...such is the cycle of an economy. It will rise and fall no matter > what amount of regulation is in place. The only thing regulation can do > is nip off the extent of the peaks and valleys. I do think that > government regulation should step in and make it less advantageous to buy > a home that the buyer is not intending to live in...and to crack down on > all the liars that claim that they will live in the home when they are > really buying it for flipping/renting/investment opportunity. > >> We just sold my late mother's house in Florida. It's just amazing how >> ridiculously low the prices are, but the banks aren't interested in >> lending because values are still falling at about 2% a month (and of >> course the fact that banks aren't lending helps contribute to the falling >> values). > > Banks are perfectly willing to lend right now. What they don't want to do > is lend to people with no/little downpayment when the current mental state > of the populace is that a person should not have to make payments on a > home if the home has no equity. I'm not sure why people have that > mindset, especially in a world where people routinely buy new cars that > lose 25%+ of their value the moment they drive off the lot. > >>> 1. People should learn to be more fiscally conservative. They should >>> save >>> up for a more significant down payment (say 10%-20% rather than 0%-3%) >>> before trying to purchase any home. >> >> 20% used to be the norm. Then 10% with PMI. These zero-down loans are >> insane. > > Agreed. Also insane is the ever increasing length of mortgages...10 > year...then 15 years...then 20 years///then 30 years...and now 40 year > loans are making their way towards becoming the new norm. > >
From: SMS on 29 Mar 2010 16:38 On 29/03/10 10:29 AM, Obveeus wrote: > ...and at the time, that was correct. In fact, the banks were counting on > people refinancing every few years. Every refinancing cycle generates > numbers/income for the bank. I was talking to a woman the other day who was telling me that she was in the process of refinancing her house to get some money out to buy a car, and she mentioned that she refinances often, the most recent time before this one being las October (five months ago). She was claiming that it didn't cost her anything because the lender said that it was a "no cost" refinance. Clearly she did not understand that closing costs were added onto the loan balance and that every time she refinanced her loan balance was going up by around $3000 (unless she had negative points to offset it, in which case the interest rate would be higher). > It is absolutely ridiculous that people can go in to get a loan and declare > themselves to have tice the income (or more) than what they claim on tax > returns...and then the government works to bail them out when they cannot > afford to make their mortgage payment. Well the government is not bailing out the borrower as much as they're bailing out the lender by trying to keep the borrower from defaulting.
From: dr_jeff on 29 Mar 2010 16:43
SMS wrote: > On 29/03/10 10:29 AM, Obveeus wrote: > >> ...and at the time, that was correct. In fact, the banks were >> counting on >> people refinancing every few years. Every refinancing cycle generates >> numbers/income for the bank. > > I was talking to a woman the other day who was telling me that she was > in the process of refinancing her house to get some money out to buy a > car, and she mentioned that she refinances often, the most recent time > before this one being las October (five months ago). She was claiming > that it didn't cost her anything because the lender said that it was a > "no cost" refinance. Clearly she did not understand that closing costs > were added onto the loan balance and that every time she refinanced her > loan balance was going up by around $3000 (unless she had negative > points to offset it, in which case the interest rate would be higher). She probably doesn't understand that once you own your home, you can lose it in a foreclosure, either. Once it's paid off, the only way you can lose it is if you don't pay your taxes. >> It is absolutely ridiculous that people can go in to get a loan and >> declare >> themselves to have tice the income (or more) than what they claim on tax >> returns...and then the government works to bail them out when they cannot >> afford to make their mortgage payment. > > Well the government is not bailing out the borrower as much as they're > bailing out the lender by trying to keep the borrower from defaulting. |