| Re: Are consumer to blame at all for mortgage/financial crisis ? |
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Group: alt.philosophy · Group Profile
Author: tata Date: Sep 19, 2008 10:27
On Sep 19, 12:41Â pm, Paul gmail.com> wrote:> I'm not trying to blame the consumer. A lot of people were taken
> advantage of when buying homes and all that.
>
> My wife and I bought our first home in November at a Fixed rate. We're
> not financial geniuses, but we know enough not to get into something
> that doesn't make sense.
>
> But apparently a LOT of people bought homes with adjustable rate
> mortgages. I mean, when I was in my early twenties, one of the first
> things I was taught was you NEVER buy adjustable rate. It's the worst
> thing you could do was all I ever heard.
Nonsense. Adjustable rates are perfectly legitimate under the right
circumstances. When I first bought my house, I used an adjustable
right and saved thousands of dollars. I even re-financed to get a
lower adjustable rate and saved thousands more.
When I realized I was going to be here longer than I had originally
planned, I locked into a fixed rate.
The difference is that I bought less house than I really could have
afforded, because a) I don't need a McMansion b) Bad things can happen
and I planned for the worst and c) That money was better served in
other places.
I bought a house that I could still afford even if my mortgage rate
went up 2 points.
Adjustable rates aren't stupid, people are. Actually, they're not
stupid, they're just ignorant/uneducated.
> I know there's a lot of shady dealings on wall street, and while they
> take 99%% of the blame, along with government not regulating, i would
> think 1%% belongs to the stupid people that bought those 1500 sq ft new
> construction homes or adjustable rate mortgages.
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