A Quote by Michael Hudson
For many people, the mortgages they took out before 2008 are so high that they would be better off walking away from their houses. That is called "jingle mail," returning the keys to the bank and saying, "You can have the house. I can buy the house next door that's just like this for 20% less, so I'm going to save money and switch." That's what someone like Donald Trump or a real estate investor would do. But the banks are trying to convince the mortgage debtors, the homeowners, not to act in their own self-interest.
Quote Topics
Act
Away
Bank
Banks
Before
Better
Better Off
Buy
Convince
Debtors
Donald
Donald Trump
Door
Estate
Going
High
Homeowners
House
Houses
Interest
Investor
Just
Keys
Less
Like
Mail
Many
Money
Mortgage
Next
Next Door
Off
Out
Own
People
Real
Real Estate
Returning
Save
Saying
Self
Self-Interest
Someone
Switch
Took
Trump
Trying
Walking
Walking Away
Would
Would Be
Quote Author
Related Quotes
Now, suppose that a homeowner puts down only 3% of their own money or 3.5% for the FHA. That means if prices go down by only 3%, the house will be in negative equity and it would pay the homeowner just to walk away and say, "The house now is worth less than the mortgage I owe. I think I'm just going to move out and buy a cheaper house." So it's very risky when you have only a 3% or 3.5% equity for the loan. The bank really isn't left with much cushion as collateral.
The problems of 2008 were never cured. The Federal Reserve's solution to the crisis was to lend the economy enough money to borrow its way out of debt. It thought that if it could subsidize banks lending homeowners enough money to buy houses from people who are defaulting, then the bank balance sheets would end up okay.
I would buy a house, and try to buy a house every month. I didn't have education or information about real estate at the time. I learned after I bought a few houses, and then I kind of fell in love with the rehabbing of the houses and fixing them up and just the whole process and turned it into a business.
If you really think that houses prices are going to go up next year and the year after, you feel if I don't buy it this year, I'm going to have to buy it next year. [...] And when somebody makes it very easy for you to do it by saying you don't really have to put up my money, you can lie about your income a little, or we'll give you 100 percent mortgage, you're going to do it, because everybody that's done it has been proven right. You have what they call social tools, and, you know, you're going to feel like an idiot if you didn't do it, because the house cost more.
I'm a businesswoman. You know, I have other investments too, real estate. A long time ago, I would buy a house and flip it. But now everybody does that, so I don't do that anymore because there's no houses out there to buy.
Money is created through bank debt. When you go for a mortgage through a bank, they give you $100,000 to buy a house and basically send you out into the world to bring back $200,000 in the next twenty years. The first $100,000 is principal, and the second is interest.
I just love how everyone with that Motown sound seemed to come from a two-block radius from the actual original location. The original location was a house, and then when they outgrew it, they bought the house next door and the house next door and the house next door until they had seven houses on the same lot.
My mom would always over decorate the house to the point where she'd switch like soap dispensers and all the towels. We would blow fuses in our house all the time because we have too many lights going on and I just feel like we did Christmas right around the Bristowe residence.
The myth is that if housing prices go up, Americans will be richer. What banks - and behind them, the Federal Reserve - really want is for new buyers to be able to borrow enough money to buy the houses from mortgage defaulters, and thus save the banks from suffering from more mortgage defaults.
The financial collapse of 2008 got its start with predatory mortgages, that weren’t sold by community banks and credit unions, they were sold by fly by night mortgage brokers who had almost zero federal oversight and then the big banks looked over, saw the profit potential and they wanted it bad. So they jumped in and sold millions of these terrible mortgages while the bank regulators just looked the other way.
The people that did it the way they were supposed to do it, the way they were taught in school: save your money, so that when you retire.They get nothing. They have nothing. They were going to live off the interest of the money. They don't have money. And then on top of it you had the problems of nine years ago [in 2005] with the mortgages so half of them their houses have been taken away.
If you ask any economist, they'll tell you all the mortgage interest deduction does is raise the price of the house. So a couple is out looking at the house, they say, "Oh, we love this house, but we couldn't make the monthly payment." And the realtor says, "Yeah, but you're going to get a tax break." So people pay more than they would otherwise. You take a loss even though you're making a gain.
When I ask people to contemplate selflessness, the sometimes react as if I've asked them to put their house on the market or give away all their money. If there was a self that existed in the way we think, discovering selflessness would be like putting our house on the market. But in the Buddhist tradition, the discovery of selflessness is called "completely joyful." It's not called "the raw end of the deal," or "I'd rather go back to bed," or "This is scary and depressing."
I want to save up money. This is probably long-term, but I for sure want to get into real estate and flip houses and start doing stuff like that. So I'm saving money. And, you know, being a kid at the same time. I want people to know I'm literally just a 16-year-old punk who's trying to hang out with some homies on the weekends.
The aim of promoting low down payments is to push prices back up so that fewer houses are going to be in negative equity and fewer people are going to walk away from the mortgages. That will save the from taking a loss on their junk mortgage loans.
How many times have I failed before? How many times have I stood here like this, in front of my own image, in front of my own person, trying to convince him not to be scared, to go on, to get out of this rut? How many times before I finally convince myself, how many private, erasable deaths will I need to die, how may self-murders is it going to take, how many times will I have to destroy myself before I learn, before I understand?
Related Authors
Allen W. Wood Quotes
American
Professor
Clayton Christensen Quotes
American
Professor
Glenn Reynolds Quotes
American
Professor
Gordon S. Wood Quotes
American
Professor
Helene Cixous Quotes
French
Professor
Jeffrey Pfeffer Quotes
American
Professor
Jerry A. Coyne Quotes
American
Professor
Richard A. Falk Quotes
American
Professor
Robert S. Kaplan Quotes
American
Professor
Ruth Simmons Quotes
American
Professor
Seyyed Hossein Nasr Quotes
Iranian
Professor