Can people who bought 400K homes be called "poor"?

[akdiver 3]

Can't afford a 250K mortgage on a 100K income? I suppose that depends on what other debts you have.

Well, duh.

[Nikita2Charles 33]

not Just INTEREST ONLY LOANS, but the banks were giving out those loans with NEGATIVE AMORTIZATION

Can you imagine instead of paying principal or at the very least Interest only, Those people were actually Increasing/ADDING to their principal every month, and the worst part of it now You would be getting Interest 2X. They tell you " Let say you add $200-300/month to your principal, after a year or 2 your house would be worth 50-100k so a $10,000 extra on your principal is nothing as you can come back to us to REFINANCE.

Someone tried to offer me that loan even though i have an over 700+ credit scored, I plainly told him, you are a CRIMINAL, you only see your pocket how can you EVEN advice me on that kind of loan scheme, and I just walked out.

Edited May 4, 2009 by Nikita2Charles

[Ling Ling 22]

Sure the banks are guilty, and Low-Income Joe Schmuck (actually more like Joe Washington and Jose Gomez) should've known better,

but the biggest criminals in this fiasco were the independent mortgage brokers. Usually, the banks didn't know they were buying bad paper,

and the Joes and Joses were being sold snake oil. Balloon loans, no money down, fraudulently improving credit scores, that was the work of

the indy brokers. Ever seen the movie "Boiler Room"? That's how these guys were operating.

Back to Joe and Jose, much of the time they were not only 1st time homeowners, but they may have been the first in their family to ever own a home.

These guys had no idea about mortgages, and trusted the slick guy driving the Ferrari, saying "I'm gonna give you a piece of the American dream".

I'm not saying that a buyer should not beware, or that a buyer shouldn't be held responsible, but there's good reason the practices are called predatory.

Even when some of these new home owners were able to make their payments on-time, some of the low-lifes in the sub-prime market, would neglect to

report their payments to the credit bureaus, to insure that their credit ratings would keep them out of the prime marketplace.

[Donna A 4]

so far, knock on wood, my ARM has been in my favor. i think it depends on when u got that. i got mine maybe 7 years ago and it was locked in at its rate for 5 years i think and then my sixth year it didnt go up at all and now im into my 7th year and it dropped due to this mess.