What do you think of the Banks that give loans to people who can't afford there mortgage?

It really depends on the situation. The Loan Officer can not always know the person can not afford it.. In other cases they may... But if they knowingly do this.. Then It is totally wrong... But if they are just doing their job offering loans on a an equal opportunity basis.. hoping their customers can afford it and trusting them.. Then I do not see the bank as in the wrong for it.. AS long as the bank presents them with enough information to make the right decision.. but again if the bank has no sign or knowledge it is hard for them to know... Now, as far as the bailout money goes.. I am totally against those bailouts.. but on the other hand.. if they were not getting bailed out.. More banks would have collasped and more people lost money that was not FDIC insured that would effect the responsible customers dragging them down with the irresponsible ones.. To help the situation the banks should have pamphelts and pamphlets available of how to earn money... To help those who can not afford it to pay off their loans.

It really depends on the situation. The Loan Officer can not always know the person can not afford it.. In other cases they may... But if they knowingly do this.. Then It is totally wrong... But if they are just doing their job offering loans on a an equal opportunity basis.. hoping their customers can afford it and trusting them.. Then I do not see the bank as in the wrong for it.. AS long as the bank presents them with enough information to make the right decision.. but again if the bank has no sign or knowledge it is hard for them to know... Now, as far as the bailout money goes.. I am totally against those bailouts.. but on the other hand.. if they were not getting bailed out.. More banks would have collasped and more people lost money that was not FDIC insured that would effect the responsible customers dragging them down with the irresponsible ones.. To help the situation the banks should have pamphelts and pamphlets available of how to earn money... To help those who can not afford it to pay off their loans..

Stupid people fall for all sorts of scams. Our government should have stopped this before it caused the real estate market to crash, though. It has ended up effecting all of us, not just the stupid people who bought houses they couldn't URL1 makes me wonder if the government officials who were supposed to be regulating the banks are: a) stupid b) lazy c) paid off d) all of the above.

Those banks should suffer full losses for their bad lending skills. However, that hasn't happened.

Here's the problem in a nutshell. Homes have become so expensive that it takes two people working in most cases to make that mortgage payment and still be able to pay the rest of the bills and eat. It seems nobody wants to build simple, affordable homes anymore that the average Joe can buy, opting instead for big beautiful homes on postage stamp sized lots and asking an arm and a leg for them.

Just look at the average home price versus average income of any given area. Due to less and less people being able to afford a home on a modest salary, banks have elongated the length of time to pay off a mortgage in order to lower the monthly payment amount (like they did with car loans; used to be you couldn't finance a car longer than five years, now it's seven or more). Last I heard there were 30-year mortgages; maybe even longer now.

I can't even imagine spending the next 30 years making huge monthly payments. Talk about a stressful life! Do you realize how difficult it is to maintain a large salary for that many years?

Odds are, you will be laid off, fired, or become so bored with your job you end up pulling your hair out if you don't get away from it before 30 years is up. So, you end up with people (families usually) who have to make the difficult decision of selling their house and moving into something more modest like an apartment. BUT WAIT!

You are upside down on your loan. What?!?! How can that be?

I've been paying on this loan for 20 years. How can I be upside-down? Answer - Simple interest (which used to be a staple in the world of loans and mortgages) is a thing of the past anymore, replaced by the much more profitable COMPOUND INTEREST!

Now, you don't end up right side up in a loan until almost the very end of the loan. So, while the banks and finances companies have enjoyed all this extra interest they didn't used to get, they are also enjoying all that bailout money as well. Generally speaking, banks are crooks and should be avoided at all cost.

For an explanation of compound interest versus simple interest, see the last paragraph. What you end up with are people being foreclosed on because they lose their job or lose an income and can't make their payment AND have no hope of selling the house to get out from under it because they still owe way more than it's worth. I make a pretty good income, myself, but guess what?

I live in an RV and I'm very proud of that fact. No taxes and it will be paid off by the end of the year (after a modest year-and-a-half loan at a whopping $300 per month). Why did I opt to do this?

I'm a professional. I am well-written, articulate, intelligent, a college graduate, and make a good income. So why do I live in an RV?

Because I'm smarter than the average bear and not nearly as prideful. No property taxes, I can paint the ceiling purple if I so desire without having to ask some landlord, and I'm not paying out the rear for a roof over my head. I've had people tell me, "But, Sami, you are missing out on the most important investment a person can make, a home."

What exactly am I missing out on? Is it the high cost of maintaining and paying utilities for such a large house or is it the losing my butt in this housing crisis I am missing out on? Additionally, if my area of the country goes south by way of employment, I can pick up and move to where the work is.It's the best lifestyle any man ever imagined for himself and I truly believe if there were less people out there with pride issues, there would be more people living this exact same lifestyle as I.

Now, I realize families would have a hard time with this due to not having enough room, but for my husband and I, it's perfect; a lifestyle I will probably still be embracing on my death bed. Compound interest versus simple interest - I know there are some people reading this who don't understand the difference between these two loan practices so let me give you an example. Essentially with a simple interest loan, you are paying the same amount of interest and principle each month.

For example, if you are making a $300 per month payment, depending on the interst rate, you might be paying $25 each month in interest and $275 each month towards the principle, but this would be the same amount every month. For the same loan with compound interest, you would be paying $5 on the principle and $295 in interest the first month and then gradually over the course of the loan the interest amount would go down and the principle amount would go up to where your last payment would be $295 on the principle and $5 in interest. The reason this type of loan is so horribly crooked is because your principle goes down VERY, VERY slowly, so you are paying out the butt in interest on the remaining principle, causing you to be upside-down until almost the end of your loan, preventing you from being able to sell your home until it's almost paid off, depending of course upon how much money you put down on it.

I cant really gove you an answer,but what I can give you is a way to a solution, that is you have to find the anglde that you relate to or peaks your interest. A good paper is one that people get drawn into because it reaches them ln some way.As for me WW11 to me, I think of the holocaust and the effect it had on the survivors, their families and those who stood by and did nothing until it was too late.