drieuxster (drieuxster) wrote,
drieuxster
drieuxster

WOW, some are more sub-prime than others...

In an article this week that examined the troubles brewing in Citigroup’s mortgage business, the Wall Street Journal focused on Natalie Brandon, a 51 year old married woman from Granada Hills, CA, who is currently unable to make the payments on her $625,000 adjustable rate home loan from Citigroup, despite the fact that the rate will not even reset higher until June of next year. Amazingly, the Journal reported that Mrs. Brandon bought the house in 1985 for just $105,000, but had chosen to refinance five times over the past seven years, borrowing more than $500,000 and spending every single penny. While this may be an extreme example of American profligacy, it is by no means unique. Unfortunately this type of behavior typifies everything that is wrong with the modern American economy.

Had this homeowner behaved responsibly, as was typical for Americans of prior generations, her current monthly mortgage payments would likely be close to $600 and the remaining balance on her loan would be about $40,000. In eight more years she would have owned her home free and clear, and would likely be on track for early retirement. Instead, after 22 years of making mortgage payments, she is now $625,000 in debt. The article stated that she had recently tried to refinance into a 6%, forty year, fixed-rate mortgage, but it fell through. Even if she had qualified, she would have been obligated to make monthly mortgage payments of close to $4,000 until she was in her nineties.

[ cf The End of Consumer Credit as we know it ]
Blink?

No, Seriously, BLINK???
Tags: they_did_what
Subscribe

  • What if we had to be a nation of laws

    First off a h/t to a dear fiend, for Crackdown on herd-share farms over certification which is such a classical attack of the FeeMarketeers meets…

  • why do folks forget the clinton years?

    Essentially I agree with When The Magic Starts in that there is much that will need to be undone from the failure of the deregulation game that was…

  • Oil does not grow on trees.

    Let us start from the premise that fossil fuels are not like renewable products such as fruits, vegetables and other forms of…

  • Post a new comment

    Error

    default userpic

    Your IP address will be recorded 

    When you submit the form an invisible reCAPTCHA check will be performed.
    You must follow the Privacy Policy and Google Terms of use.
  • 1 comment