Rewarding the irresponsible

As a compassionate person I hate to hear about others having to endure hardship. But, I also think it is unfair to others to use tax dollars to bail people out of their own mess visa vi foreclosure bailouts. Here is why.

Take two guys, Steve and Joe. Joe is not confident that he can afford to pay off a mortgage and fears one day he may default. Not wanting this to happen, Joe continues to rent a home rather than buy one.

Steve on the other hand decides to through cation to the wind and buys a house he is not sure he can afford.

The economy goes bad and Steve is forced to sell his house at a loss.

Joe on the other hand has diligently saved his money while renting and paying into someone else's equity. Now Joe feels confident he can pay off a house and is looking to buy while it is still a buyer's market.

Now, along comes the Government. They decide that the compassionate thing to do is to help Steve hold onto the house he never should have bought in the first place. In doing so, they are also unwittingly screwing over Joe because Joe, who was fiscally responsible, stands to benefit from the low housing costs and high foreclosure rate.

Instead, because the Government is bailing out Steve who was irresponsible, Joe is less able to negotiate a better price.

Now why is it that Joe responsibly rented for years and now Steve is getting bailed out so he doesn't have to be forced to sell his house and become a renter again after screwing up?

Doesn't this make you wish that you had gone out and irresponsibly bought a house you couldn't afford?

How exactly is it a good idea to reward the irresponsible and punish the responsible at the same time?

what if your best frnd that always lent you money and let you pay it back a little at a time had gone through somthing that left him nothing to eat and no money to get food???? would you bail out yer frnd and lend him 10.00 for a meal??? just a thought

I know what ya mean RW, I like to think, however, that those of us that are responsible, still come out ahead in the end. I know, it's not always the case, but at least you know damn well, whats yours is all yours, that means something.

tusseltussel said:

what if your best frnd that always lent you money and let you pay it back a little at a time had gone through somthing that left him nothing to eat and no money to get food???? would you bail out yer frnd and lend him 10.00 for a meal??? just a thought

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WTF? I'd answer but I'm afraid if you think to hard you might hurt yourself.

Here's my take....look around you. All too many young couples are opting as their first home a million plus lot that they CANNOT afford....living on the extreme edge because they have an incessant need to keep up with they consider "mainstream."
I'll use my parents as an example. They had five children, both worked......both had good jobs. They built equity on what they COULD afford.
They now live in a house bigger and more gorgeous than anything I ever grew up in.........and they "now" can afford a helluva lot better than what they reside in.
Should I feel sorry for the neighbor who deemed it necessary to skip all those "unecessary" inconveniences?
Nope.

Babs34 said:

Here's my take....look around you. All too many young couples are opting as their first home a million plus lot that they CANNOT afford....living on the extreme edge because they have an incessant need to keep up with they consider "mainstream."
I'll use my parents as an example. They had five children, both worked......both had good jobs. They built equity on what they COULD afford.
They now live in a house bigger and more gorgeous than anything I ever grew up in.........and they "now" can afford a helluva lot better than what they reside in.
Should I feel sorry for the neighbor who deemed it necessary to skip all those "unecessary" inconveniences?
Nope.

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The better question is should your parents have to pay to bail them out when doing so is not only unfair to them but also unfair to the responsible guy waiting to buy that home on foreclosure.

I say hell no! Irresponsible borrowers should take the hit and we should let the house go to those who were more responsible.

Sure it is sad to see people lose money but their loss is another's gain in this case. The guy losing chose to roll the dice so when he craps out, why shouldn't more responsible people be allowed to strike while the iron is hot?

RickWhite said:

The better question is should your parents have to pay to bail them out when doing so is not only unfair to them but also unfair to the responsible guy waiting to buy that home on foreclosure.

I say hell no! Irresponsible borrowers should take the hit and we should let the house go to those who were more responsible.

Sure it is sad to see people lose money but their loss is another's gain in this case. The guy losing chose to roll the dice so when he craps out, why shouldn't more responsible people be allowed to strike while the iron is hot?

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I DO see your point.
At the same time, I also see a tremendous amount of Americans suffering because of this crappy economy.
There are also a handful of people who did wisely purchase. And now, because of unforseen layoffs, are facing living on the streets--"while" Joe is facing taking advantage of their hardship. There isn't a whole lot in life that is "fair."
Compassion can be a voice of reason in certain circumstances.
Just recently, I purchased my first home. Honestly, I was much more interested in finding a nice foreclosure. For all practical purposes, I could have spent less and ended up with so much more.
I don't know though...I just don't know how I could feel good about getting a "steal" on "my" new home---while a family is possibly facing living in a shelter, or on the streets for that matter. And trust me, I see them on the streets more and more often here lately.
Also to consider with these foreclosures....so often prior owners are so resentful they are being forced to leave their homes, that they put numerous thousands in damages prior to their move out.
That may still be a deal to those who are "fixer-uppers"......but to me, it only serves as a reminder of the impending doom/turmoil that family is living in.
There's just no balancing any of this at this point.
Did I hear correctly that America spent over 80 million to send a rocket crashing to the moon's surface?.....so happy to see that Obama is being frugal.....pfft.
I'd say our government is much more out of control with "their".."our" expenditures than everyday people even DREAM of being.

Babs, I don't disagree with anything you have said - it is a tragedy in some case. Although I think the majority of people losing their homes will have to downgrade, rent or move in with relatives. Most won't be living on the street.

But what about the people who have paid rent most of their lives and lived in a cramped apartment who now have a chance at first time home ownership? Why is it people always sympathize with people who had money but lost it? Where is the sympathy for those who never had money? To bail out the former is to deny the latter. This just isn't right. Like with most things Government needs to stay the hell out of people's lives and let the free market run its course.

Funny thing, I'm wondering why DoobnVA hasn't weighed in on this. I suppose it is because the Socialist model creates cognitive dissonance in this situation. Should Government help the downtrodden at the expense of other downtrodden? That kind of cuts notions of Socialism off at the knees.

The suffering is self inflicted Babs.....

Nothing wrong with FEELING pity on these poor sods, but I shouldn't have to bail them out of their own mistakes brought on by themselves. Nobody tackled these ppl out in the streets and dragged them into those loan offices.

You must NEVER reward failure. People don't learn lessons that way, and will make the same mistake again.

Tough love is just that..... tough, but loving. Learn from ur mistakes and move on.

CrackerJax said:

The suffering is self inflicted Babs.....

Nothing wrong with FEELING pity on these poor sods, but I shouldn't have to bail them out of their own mistakes brought on by themselves. Nobody tackled these ppl out in the streets and dragged them into those loan offices.

You must NEVER reward failure. People don't learn lessons that way, and will make the same mistake again.

Tough love is just that..... tough, but loving. Learn from ur mistakes and move on.

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CJ, there's so much more to consider than what merely meets the eye.
I honestly don't know anything about how the gov't may or may not be bailing out foreclosed homes.
The scenario that keeps hitting home with me is of a hard-working man--who put himself through school, graduated magna cum lade....labored 60 plus hours a week. Imagine this scenario. Say he is making 80 grand a year. Let's just say that he is fresh into his field. He has seven children and where he lives, that million dollar home was not exactly an excessive purchase.....he lives in NY CJ...ok?
Out of nowhere, a layoff is inevitable. In fact, it is now very likely that what was once his "specialty" will now no longer be a service that is required/necessary....as in anywhere, ever again. (This happens all the time, know it.)
What a slap in the face that would be.

There are many responsible people who bought homes they COULD afford, whose mortgage payments doubled or tripled over the course of a year or two because of adjustable rate mortgages. These people are losing their homes not because they bought more house than they could afford, but because the LENDERS make it a point to glaze over the fact that this "affordable" home could, at any time, become "unaffordable". These are people who paid their mortgage payments every month, on time, until the interest reached a point that was no longer within the realm of reality. Many lenders offered "teaser" rates as low as 4%, particularly in cases of subprime loans. These people, in many cases, were led to believe that they COULD afford these homes because they weren't being told that in a year or two their mortgage payment would be DOUBLE or more what it was at the time of purchase.

Yes, people always live beyond their means. The average American has negative savings (meaning they are spending MORE than they earn). We've come to believe that living on borrowed money is just fine and dandy. We've become a nation of "buy now, pay later". The POOR are actually more likely to continue making payments on credit cards and loans in order to pay off the debt, whereas people with higher incomes are likely to feel "entitled" to stop paying and let the credit card companies and lenders eat the loss. This is because the poor realize that everything has it's price, while wealthier people feel that the world owes them a debt of gratitude for simply existing.

I can definitely see the OP points. It's ridiculous, people living off credit cards, living beyond their means. But, I think all of this bailout stuff is more about the big picture, rather than just being compassionate. I think the idea is that too many foreclosures will keep driving the economy into the toilet.

The POOR are actually more likely to continue making payments on credit cards and loans in order to pay off the debt, whereas people with higher incomes are likely to feel "entitled" to stop paying and let the credit card companies and lenders eat the loss. This is because the poor realize that everything has it's price, while wealthier people feel that the world owes them a debt of gratitude for simply existing.
...damn good point there.

tusseltussel said:

what if your best frnd that always lent you money and let you pay it back a little at a time had gone through somthing that left him nothing to eat and no money to get food???? would you bail out yer frnd and lend him 10.00 for a meal??? just a thought

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Helping a friend is a wonderful idea, if you are inclined to.

Maybe some do gooder socialist will come up with a win-win plan where fat kids stolen from their parents will be ground into food for the unfortunate foreclosure "victims". Since the fat kids won't be around to sleep in their little fat kid beds anymore, the people who lost their houses could bunk with the grieving fat kids parents. No more fat kids, no more homeless foreclosure victims. Not to mention the government jobs that could be created to administer this program... Win-win huh?

THAT was scary.
God knows I cringe every time someone says the government OWNS your children.
~~~over my dead body, and I mean that .....literally.
No, my kid's not fat, but no one upon NO ONE has the right to take a child away simply because they are obese. That should never factor in with government entitlement to take your flesh and blood. NEVER.

Rob Roy said:

Helping a friend is a wonderful idea, if you are inclined to.

Maybe some do gooder socialist will come up with a win-win plan where fat kids stolen from their parents will be ground into food for the unfortunate foreclosure "victims". Since the fat kids won't be around to sleep in their little fat kid beds anymore, the people who lost their houses could bunk with the grieving fat kids parents. No more fat kids, no more homeless foreclosure victims. Not to mention the government jobs that could be created to administer this program... Win-win huh?

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You're a very sick individual.

Babs34 said:

CJ, there's so much more to consider than what merely meets the eye.
I honestly don't know anything about how the gov't may or may not be bailing out foreclosed homes.
The scenario that keeps hitting home with me is of a hard-working man--who put himself through school, graduated magna cum lade....labored 60 plus hours a week. Imagine this scenario. Say he is making 80 grand a year. Let's just say that he is fresh into his field. He has seven children and where he lives, that million dollar home was not exactly an excessive purchase.....he lives in NY CJ...ok?
Out of nowhere, a layoff is inevitable. In fact, it is now very likely that what was once his "specialty" will now no longer be a service that is required/necessary....as in anywhere, ever again. (This happens all the time, know it.)
What a slap in the face that would be.

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Layoffs are part of life though babs...everyone faces that dilemma at some point. Ppl who actually READ their contracts are not being thrown out. ppl got greedy and a lot of folks were thinking that flipping houses was the way to go. It was not.

In the end again, you don't reward failure, unless you wish to repeat the failure.

The govt. used taxpayer money to push bad loans out of political correctness. It needs to end there.

By the way, the Democrats are bringing fred and fannie right back to where we were in the beginning.... pushing more bad loans.

Makes me wonder if they truly care about ppl or just their votes.

doobnVA said:

You're a very sick individual.

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Sure I am, would you like to pay for my therapy?

Rob Roy said:

Helping a friend is a wonderful idea, if you are inclined to.

Maybe some do gooder socialist will come up with a win-win plan where fat kids stolen from their parents will be ground into food for the unfortunate foreclosure "victims". Since the fat kids won't be around to sleep in their little fat kid beds anymore, the people who lost their houses could bunk with the grieving fat kids parents. No more fat kids, no more homeless foreclosure victims. Not to mention the government jobs that could be created to administer this program... Win-win huh?

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Ive always thought they would start taking fat kids from parents sence they started the whole vegan crazy fat kids on maury.

Maybe the fat kids can make liscens plates and they can leave pot heads alone this plan could be win-win.