By Martin Bosworth
Over at Private Intelligence, I have a grim post that explores the depths many industries are going to squeeze money out of the impoverished, the indebted, and the uneducated.
Read it and weep.
Categories: Crime/Corruption, Journalism
I’ve been looking at the housing side of this for some time. You have all these new gimmick financing schemes aimed at helping people who couldn’t afford a house otherwise get into one. First it was the ARM, and those seem to be behind a lot of the foreclosures here in the Denver area (which leads the US in foreclosures). Then interest-only loans. Now lately I’ve heard ads for 50-year mortgages and SUB-interest loans.
All this means that I can’t risk buying a house. A lot of the developments out here are pretty much built on these kinds of things, I imagine, and what happens to my property values when I wake up one morning to see half the houses on my street foreclosed?
This is ugly and the government needs to put an end to it.
My wife and I DID wake up one morning to find a large number of houses on our street foreclosed, and it sucks badly. We put in tens of thousands of dollars into our first house and, while we sold the house for more money than we bought it for, we still sold WELL below our initial investment plus all the upgrades (deck, pavestone patio, backyard landscaping, and finished basement). So we got screwed.
Parts of the Denver housing market are doing fine (my new neighborhood being one of them, thankfully), but the fact that developer’s are overbuilding like mad is a huge part of the problem. And why are developers still on a building spree even when there’s a massive oversupply of homes? Because Colorado has no significant laws against the very predatory practices we’re talking about. We could bring this whole house of cards tumbling down by simply putting a new law or two in place.
Of course, the damn construction business is making money hand over fist right now, so they’ll lobby hard against any significant changes. And who are they making their money on? The people getting bamboozled by predatory lending companies. There’s nothing like paying someone else to screw you over….
Yeah, seriously, the NERVE of those people declaring foreclosure and wrecking your property values! I bet the first thing they thought when they signed the papers was, “Well, at least I’ll be able to torpedo Sam and Brian’s net worth on the way out.”
I’m just busting on you guys, but you have to admit those comments are unusually self-absorbed. 😉