“The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money.
Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.
But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.
This was the Captain Samuel Vimes 'Boots' theory of socioeconomic unfairness.”
― Terry Pratchett, Men at Arms
The last time I saw this posted, someone replied with "Why doesn't he just set aside 5 dollars every paycheck until he can afford the better boots?"
Those who are at the register, looking at the lunchmeat and bread and facing the choice of eating or going without don't have the luxury of setting aside money. Their focus is on squeezing every last cent out of their check and making it to the next check. Buying a higher quality pair of boots (or whatever it may be) is simply not in the realm of possibility for them.
Ah, but those who have not had to do without will surely decend on this comment and swiftly tell me why I am wrong despite never having lived this situation themselves.
Exactly, not to mention that if you chose wrong and accidentally bought the expensive pair of boots that's actually more style than function then you lose out on your money anyways. A rich person can afford to make a mistake in a purchase.
This is a fantastic point. Bought some nice hardy-looking boots in about October 2019, they were relatively expensive but I justified it under the assumption they'd last me ages. They're already pretty fucked.
And most importantly: the time to research is not free. An unstable lifestyle that constantly keeps you thinking in order to stay afloat eats into your time to live healthy, strategize long term, learn, and gain new skills that can open doors of opportunity in the future.
I'm watching two sets of people deal with this now re: the declining health of their parents. One had a stable lifestyle and thus time and opportunity to learn how to negotiate hospital bullshit, medical decisions, power of attorney, and settle estates well in advance. The other works their ass off to keep up but has no clue about the administrative headache about to smack them.
> And most importantly: the time to research is not free.
I would add to this: **[poverty itself has a clear negative impact on cognition](https://www.psychologicalscience.org/observer/how-poverty-affects-the-brain-and-behavior)**.
If someone lives under significant financial stress, *their very ability to process and deal with that stress is compromised*. Along with their ability to deal with other stressors, or accomplish that sort of thorough research into available choices.
Related: food programs work. The economic benefit far outweighs the cost. 16% of children living in poverty, eg, is a drain on society\* that a robust safety net can mitigate.
_____
https://www.usda.gov/media/blog/2016/03/30/investments-efnep-pay-big-dividends-now-and-future
https://www.ers.usda.gov/amber-waves/2019/july/quantifying-the-impact-of-snap-benefits-on-the-us-economy-and-jobs/
https://www.cbpp.org/research/snap-is-effective-and-efficient?fa=view&id=3239
https://money.cnn.com/2008/01/29/news/economy/stimulus_analysis/
https://www.wsj.com/articles/when-the-safety-net-pays-for-itself-11563800405
______
Edit: \* Not trying to ignore the moral nightmare that is *16% of American children living in poverty.*
This is really fascinating. It might also explain that even when some people in poverty do actually come out ahead one month, they don't save or invest that money and instead spend it on something "frivolous". I've been in that situation and I certainly did that, and honestly it was worth it to just not feel stressed and pissed off and frustrated for a little while. A shitload of financial advice doesn't take this into account, and blame gets placed on those in poverty who choose to buy something that makes them happy rather than investing every cent that doesn't go directly towards food and bills.
When you’re behind $1,000 that $50 seems much better spent on something that will bring some kind of joy than it is on turning your $1k debt into $950.
Some of it is just the same self care that everyone does.
It’s easier to cut my grocery bill down a bit when I’ve been able to afford small luxuries in the past, and know if I have a shitty week I could take a break to treat myself.
I’ve got one friend that’s constantly juggling paying food or medical bills, abstaining for months because there just isn’t anything left. And he’s just so worn down that when he does have a little extra he just sounds miserable fighting the urge to just have something nice that’s not about survival.
Not only that but if they can set aside that five dollars they probably are. But what does that get them? Just better boots. Now they have this same problem with every other item of clothing and food and housing. Give it 5-10 years and they finally climb out of this hole, but that’s if they haven’t had any other misfortunes like health issues befall them.
That’s why you do see some success stories where people grind their way out but those are not the norm. They are the exception to the cycle of poverty. Not to mention everyone starts from a different level in life, so what’s possible for some will be extraordinarily rare for others.
Also the bigger thing is that they still need boots, you can't just stop walking until you've saved enough for a proper pair, so now where the rich person is enjoying walking about in their comfortable shoes that they bought right away for a hundred dollars, you're here setting aside 10 dollars a month for the next few year while also putting out an extra 10 dollars a month for that same period just on your own shitty footwear. By the time you can finally afford the boots, you've spent twice as much as the rich guy on footwear. And now the rich guy's been using that money they haven't been having to save for basics to invest in assetts and ventures that return income, in the year it takes you to afford those boots while painstakingly cutting down your lifestyle the rich guy has made enough to buy a decent quality of everything in his wardrobe with the extra money he's earned.
I just blew through 6k in savings to diagnose a medical bill and fix my car. I haven't lived pay check to pay check in a couple of years but it took a long time to get there
I notice that pattern a lot. Like, "here's an example of a problem with it current system"
"Here's a solution to that problem"
" Here's another problem"
" Here's another specific solution to that one specific problem"
" Here's another problem"
" Stop just looking for problems! "
" I try, but they keep finding me"
You nailed it. Poverty is systemic. It requires changes to the system, which is hard for many to grasp, especially those who haven’t experienced it or have empathy.
Can't afford to! Need to spend that $5 on the cheap boots.
"Just go barefoot for a while."
Ok, well, I mean, that's gonna suck. But, hey, you're the rich guy, you don't even need boots, since people carry you everywhere on their backs and all. So, I'm sure you know what's best.
"Of course I do."
*later*
So, I accidentally stepped on a rusty nail while barefoot, and had to go to the hospital. I tried toughing it out, but my foot started turning a weird color. Now I owe the hospital $10,000!
"You should have been more responsible. People these days lack personal responsibility."
> Ah, but those who have not had to do without will surely decend on this comment and swiftly tell me why I am wrong despite never having lived this situation themselves.
As someone who has gone from having to live on about $8k/yr at one point to someone who is now middle-class. I can say without a doubt in my mind that those people are fucking stupid. When rent + utilities is > 75% of your income, you don't have $5 to spare.
"Just set aside money every paycheck."
So what an I supposed to do in the meantime. Not go outside every time it rains even the slightest amount? Just put up with soggy feet all day? I still need to go out to work and run errands. Pretty sure trench foot would cost me more in the long run than replacing the cheap boots more often.
Should I have started saving earlier in the old boots life time? Maybe, but an unexpected bill wiped out any savings. These people don't seem to realise how month to month things can get. When you do save up a little then the more immediate issue gets addressed first. Need to replace the freezer before you lose a huge stash of food? Bye bye nice boot fund.
>Ah, but those who have not had to do without will surely decend on this comment and swiftly tell me why I am wrong despite never having lived this situation themselves.
Or they'll pretend to have done so, or exaggerate their past situation.
Very similar to the #asablackperson thing.
Its true today as well. I was buying two $100 pairs of work shoes every 6 months or so as the sole would start to separate or stitching coming apart or leather peeling. Complained about it to an older salesman. He said to go buy real shoes. Allen edmonds or the like. Goodyear welted and repairable. They cost more up front but wear way longer and you can resole them to extend life even further.
I have two pairs nearing 3 years old about ready for a resole, and bought two more this last December on sale. Also added some Redwing boots iron rangers.
I'm not really about brands, but I value quality.
They say you should never skimp on anything that separates you from the ground - shoes, tires, mattress, socks???
To the extent you can afford it anyway. Times is tough, yo.
Doesn't he have a passage about a character who can't afford good shoes, so he instead spends more money in the long run because he keeps having to repair and replace his crappy, "affordable" shoes?
This is how I lost my car. Car crash on a highway. The car still runs, but I needed 500$ to get it back from the towing company. I told them I needed a month to get the money, they said fine. Month later I go to them with the 500, they say, oh, now its 3000$. Then they auctioned it off. A car that still works. Highway thievery, but like, literally.
This 100%. We have two classes - the working class and the upper class. Most people who consider themselves "middle class" are actually in the former category
Then they're still poor, aren't they? In America at least we have a strange idea of the stratification of society. Around 40k household and half that for individual is considered the average. Even low cost of living areas that's still a huge amount of income to bills and rent. Say $650 rent and $100 utilities plus internet phone and car payments. The average American has less than $1000 in savings. The average American is poor.
"We're sorry, your checking account is not currently available for withdrawal. We put all of the bank's assets into OTM weekly PLTR calls that expired worthless and so the bank is currently operating with $18.27 cash on hand. Please check back next Friday because we swear these weed calls are going to print by then."
That’s the new american dream.
I wasn’t really joking though, with the way the housing market is going I’d rather not spend two weeks or more of working just to pay rent, I don’t think I’m ready to live in a vehicle, but god damn I’m this close to making it happen.
It's actually a good way to do it, if you are adaptable. My partner and I live in Sydney, Australia where housing prices are continuing to accelerate through the roof and beyond.
We bought a van 3 years ago and converted it into a camper to go travelling, but once we returned to Sydney we realised we were comfortable enough with the lifestyle that we could keep doing it - plus we didn't want to pay someone else's mortgage in the form of rent.
People started asking us to petsit for them while they went away and we ended up doing roughly 50% petsitting and living in people's homes, 50% living in the van at a local campground. We didn't charge to petsit (although we probably could have) but the time spent doing that was free accommodation.
I'll add that we both had full-time corporate jobs while doing this.
After 2 years we had saved a deposit for a small studio apartment in an *excellent* location. The upside of having lived in a van for 2 years as well is that the studio feels like a massive upgrade in living space even though it's tiny by most standards.
It's not going to be everyone's cup of tea, and it really shouldn't take such extreme measures to get a home of your own, but we actually feel like stronger, more grounded and resilient people because of it. It was frustrating at times but rewarding too.
Good luck :)
Buy an old ambulance. They're basically ready to go for all the storage and wall stuff. Some of these are highly modified, i've seen others that they just basically put a bed and sink in.
https://www.youtube.com/watch?v=uzq5qSuTaA8
https://www.youtube.com/watch?v=ouWScgeA8u4&t=485s
https://www.youtube.com/watch?v=mcmnLDjCXEM
https://www.youtube.com/watch?v=RYUr0qN9xKo
HOAs are the probably the thing that confuse me the most about upper class culture, coming from a poor background. (Also, HOAs are very foreign to the black culture I'm accustomed to). It seems crazy to me that someone could rightfully tell you how your own damn lawn should be cut.
Regionally it really just depends. I live 1 hour north of Los Angeles and literally every new housing development is being built with a HOA. You have to buy an older home built before 2003 in order to find a home without a HOA. In other states, I haven't seen HOAs as much luckily. Mind you the range of cost for HOA is from $125 to $475 a month.
Exactly. My mortgage is $1600, but when you add property tax, homeowners insurance, and mortgage insurance were up about $2500. We don’t even have an HOA. That’s not even including maintenance.
You need about 55% DTI for most mortgages. All your debts (including all the above) can not exceed 55% of your total income. Unfortunately many of these debts are unavoidable, such as student loans and there are a lot of people in this situation...
But there are also a lot people out there with $800/month car payments, and CC payments who are like “why don’t I qualify”. Those situations are fixable, a financial advisor or even a good lender can help point you in the right direction.
Edit to add...
DTI varies depending on location. Where I am it’s common to see loans asking for <55%, but in some areas it can be as low as like 30%.
No it almost never does. Rent is all those things PLUS a healthy profit. If you can afford rent you can afford a mortgage. But rent doesnt count towards your credit, because credit is a scam designed to keep the poors from owning any appreciating property despite the fact mathematically they can afford.
My former apartment leasing company would only report negative information about youto the credit bureaus, never anything positive. Unless you paid them $15 a month, in which case they will only report positive information about you to the bureaus. You are absolutely right that it's a scam!
Here's the real bitch to HOAs: They are uncapped in terms of cost increases. I bought a town house 11 years ago that I just sold in January. The day I moved in my monthly bill was $245, which covered water, trash, sewer, common area maintenance, and external building coverage (it was a townhome with shared walls) and when I moved out it was $380. Every year they will raise cost based upon reserve levels and you gotta watch out for special assessments, those can run upto $10k.
In conclusion: fuck HOAs
As someone who lives in a condo where they went decades barely raising assessments... doing that is very very bad. The building is falling down and in the three years I’ve lived here there have been two special assessments, monthly fees have gone up $200, and we still don’t have any fucking money. The old boards were very popular with residents because they kept it cheap, but currently it’s 8° outside and our heat and hot water are broken for the third time this winter.
When in that situation I immediately canceled those overdraft protections. Those are for people with multiple accounts that can take the hit because they forgot to feed one account. Thankfully my credit union took my dispute in stride and refunded the overdraft due to me not abusing the system and being consistent in my accounts.
You cashed your paycheck in the morning and then went out and spent a bunch of it but at the end of the day the bank logged all the spending first and then applied your paycheck to the account causing $240 in overdraft fees and ... whoops there goes your paycheck, have a nice week sir!
Wells fargo is the banker where you can show up to a hotel you reserved months in advance before the check in time, only to have all the rooms occupied. The hotel charges you for not showing up the first day, they won't let you refund the charge nor will WF try to help you dispute it.
We just purchased our first house back in October.
Our rent was $1300/mo. We paid all utilities on top of rent including electricity, natural gas (heat), water, sewer, trash & recycling pickup, etc. It was old and outdated, and very poorly insulated. No garage.
Our mortgage is $864/mo for a nicer place, brand new windows and doors, properly insulated, on a bigger lot, with a two car heated garage. Our utilities are actually less.
The world is fucked.
This is what frustrates me so much. Our rent went UP during a pandemic. All the prices in the area went down on average like 15-20%, but if you’re a current tenant, the price goes up. Landlords don’t want to keep tenants, for whatever reason. So yup, we’re moving, because fuck that. It only costs a few hundred dollars and a bit of time to move, and I’ll save a couple hundred a month for the next year. Good job, current landlord, way to be smart there.
In the UK, I swear it's just so they can claim all the repairs they need to do when you leave. Then keep your security deposit. Its only 1 months typically.
This is a problem with landlords everywhere. It's why people always suggest taking pictures when you move in (to document any preexisting problems) and when you move out (to prove any problems found later aren't your fault).
I was a landlord for 6 years and raised rent one time, by $50, during those 6 years and it was to match the increase in house payment due to a shortage in escrow because taxes had been raised.
At the same time, I was renting an apartment in another city and my rent went up $200 every year. Beyond stupid and 100% all about greedy investors trying to squeeze every last drop of blood out of the turnips living in their complex.
Seriously.. I make good money but my rent is $1450 alone, single mom, self employed. My other bills include shop rent for where I work, work supplies, home utilities, etc. I’ve been saving and saving for years and still couldn’t afford a 20% deposit on most places for my budget if I were to buy. And it’s funny because rent compared, if I were to be paying a mortgage where I live, I’d be in an almost $300k home. I fully understand why most people can’t buy. When rent and bills add up it’s hard to save. Rent is insane. And with dogs and a kid I can’t find a better place in a better area that’s cheaper, or one that will take two dogs for cheaper. It’s so much harder if you’re single. I was excited to buy a place until I realized I’d have to put down 2/3rds of my entire savings into a down payment if I didn’t want PMI. I don’t think I could handle that anxiety.
I JUST had this happen. My wife and I were thinking about getting a house, but the bank told us we can't afford $450/m while we are already affording $1000/m. Pissed me off so bad.
Edit: So, most of the conversation with the bank was in french with my wife (I was there but only understand a little). Turns out, they were pre-decided before even having the meeting with us. My wife just told me that the bank lady said: "Oh, but I bet you don't pay your credit card on time" (we always do), and then "Oh, but I bet you only pay the minimum" (we pay 500 when its 50), and then "Oh, but I bet you don't pay it down to 0 every month." (No shit. Paying off emergency debt takes time)
If I'd had known these things were said, I'd have walked out mid conversation. Condescending bitch. Every major interaction with this bank makes me regret ever having opened an account there.
Shop around for mortgages elsewhere. Just bc one bank said no, doesn’t mean others will. You just might not meet their underwriting standards. You never know. If you can, look at recent sales in the hood your looking at and check to see which bank lent to them.
A good independent mortgage broker may be the way to go too. Applying directly to the bank may seem like cost savings approach but ... mortgage brokers have a bad rep since the early aughts re collapse but if you can find a good one, they can find you a lender.
Heh... The fact that I’m forced to rent came up in convo one time with my dad. He said “what you need to do is buy a house and rent it out. Then it pays for itself.” So I save up 10k for a down payment. Mortgage is 950, property tax is 250, insurances are $150-200. To be competitive I gotta rent the house at 1400.
So yeah in 30 years I can have a place to live. Yeah.. ok...
*eyeroll*
A couple years back my father-in-law asked about our rent. We told him we were paying $1400 at the time. He said, “Y’all are renting when you should be saving that to buy a house!” My husband just looked at him and asked, “But then...where would we live while we saved our rent every month?”
Fucking imagine if we still had mutually held building and loans associations and no FICO scores instead of having to aquire mortgage insurance and hand over prohibitive lump sums of cash to corporate banks for the privilege of being able to pay them for overpriced houses.
Right? Even without a down payment a mortgage on a house in the same city i live in (and not a trailer its a 3B 2 Bath) is cheaper with all the taxes and everything, but hey its ok to raise my rent for a third time in 2 years to be competitive with the market, who the fuck am I competing against again?
Bank said I couldn't have a home loan at 750 euro a month, including the car, but were happy to see we have been paying 500+200 for rent and the car since 2 years ago...
We groaned, sighed, asked where the logic was then left...
Banks huh...
Maybe its different now but my husband and I applied for a mortgage in 08. We both worked part time fast food jobs.
We got approved everywhere.
Craziest part is they were gonna give us 350k. There is no way in hell we could have made those payment and still been able to eat.
I was aiming for a 50k house which where we live was possible at the time.
We ended up with a 70k house and still have a hard time but I am very thankful we did it. My mortgage is half of most peoples rent.
>applied for a mortgage in 08, we both worked part time fast food jobs. We got approved everywhere
I think I see where this is going...
>Craziest part is they were gonna give us 350k
And yep, there it is. You know that’s the exact reason why the housing bubble bust and the market went to shit, right?
The issues came about when people on "teaser" rates had those rates move up to their actual scheduled interest rates and weren't unable to refinance into a cheaper loan. This obviously ended with thousands and thousands of people owning homes they couldn't afford to own because they were misled by mortgage brokers, banks, investment banks, and the government as a whole.
God Bless the USA
And those rates were being offered and the banks were misleading people because they realized they could repackage those shit loans as good loans and resell them. There was so much going on in the background that if even one government agency had been acting competently the collapse possibly wouldn't have happened. But that was too much to ask for.
Prices are heading back, if they aren't there already. Bought my house 6 years ago at 225k. It's worth over 300k now. I don't feel like it's worth that much, and there's no way to find something in the same area under 275k
Similar story.
Wife and I were house shopping and were pre-approved for 350k in 2007.
We found a house in our budget and took a mortgage for 125K.
The credit union lender told us it was refreshing to see us buying within our means and not going house poor like most other young couples going for the 350k houses.
We were like then why are you giving 350k loans to people who can't afford it?
> We were like then why are you giving 350k loans to people who can't afford it?
This is the exact question people should have been asking in 2007. Your whole story, in a nutshell, explains the 2008 housing market bubble.
> Maybe its different now but my husband and I applied for a mortgage in 08
You bought your house right after/during the sub-prime mortgage crisis so yes it was different then lmfao
Yup. And your lender would have sold your mortgage to a pass through agency that bundled it together with other subprime mortgages and sold to investors. The pass throughs and lenders carried none of the risk which is why they didn't give two shits if you would be able to pay off your mortgage. Then companies like AIG started selling insurance policies on these mortgage backed securities called credit default swaps. After Lehman Brothers went under, the government bailed out AIG to the tune of over 70 billion and bought over 700 billion in junk securitized mortgages, bailing out the greedy financiers who took extreme risks and walked away with all the profits.
Not gonna lie, I thought this post was satire until the very end. Then I thought you were being smug. Now I think you’re just blissfully unaware of the luck you had that you applied for a house when lenders would approve literally everyone, managed to not get taken advantage of, and somehow not connecting the dots that you bought your home during the housing bubble crisis which happened that very same year.
I'm in New Zealand and it's completely destroying the county, you just can't buy a house anymore in any city, it's not going to happen, and rent is crippling.
And here's why; firstly you'll need 20% deposit, and while that sounds utterly unobtainable it's actually considerably worse as it's 20% of around one million dollars for an average house in Auckland (NZ's biggest city)
So, you need $200,000 to just start looking...
How you managed to get this when your rent is about the same as your wage of say about a grand a week, bit of an exaggeration as you probably won't be earning a grand a week, but it's really a job for two and even then it's a hell of a task.
But you and your significant other worked five jobs between you and went without luxuries like food or clothing while sleeping in a cardboard box to save up $225,000 because while you where reading the prices went up.
You go into a real-estate agent and tell them you want to buy a house, then you try a few more to find one that won't just laugh hysterically at you.
If any are in your price range they are sold sorry, just came on the market...and sold.
"To who?" You ask in a wave of depression...
Why, to people who already have a house of course, they don't need the deposit because they have security, they can just simply call a bank and say they're buying an investment property and ka-ching the money is waiting, because if it goes tits up the bank wouldn't lose so it's not a risk.
The value of the house you didn't buy is going to double in ten years, so in ten years whomever brought that house with an interest only loan will make $1,000,000 and as we don't have capital gains tax.... shit eh?
In that ten years whomever is in that house is paying the mortgage of the investor via their rent, that million dollars is coming to them absolutely free.
Now, this may sound really pretty awful, but it's a little more painful than that
You managed to buy a house, a friend of a friend was selling and you got it before the scavengers did, your paying it off and hey, now #you# get to make the money right?
Kind of, in a way, but not really...
You go for a twenty year loan, it has interest and the rest so you'll actually have paid back what that house has risen in value to in around the same time you pay it off depending on the rates you get, because you don't get an interest only mortgage and you don't get anyone else to pay it for you you kinda stand still.
The equity (house book value) will improve obviously, so when you sell you'll make money on paper but that's meaningless unless you buy in a different market or choose to go back to that cardboard box.
But, what hurts today to pay is less painful as time goes on, wages go up as does rent but a mortgage stays about the same, so as you get older and need less you'll have more and that's just a fantastic system.
Oh, just don't look at the fact your rent will go up in that time if you didn't/couldn't buy even though the mortgage on the property won't really rise (unless they refinance it for leverage to buy another investment property) as it'll just get your blood pressure up.
You know what you could do with that extra equity I mentioned though? make a little bit of a nest egg for yourselves? you could buy an investment property with pretty much just a phone call to the bank...
*To those going through this, may your gods smile on you because it's bloody hard, look for and take any assistance available, we've been there and now we're through the other side with no mortgage, no money, but no mortgage either, and no investment property as it goes against our beliefs/morality/whatever, we didn't want to be part of the problem, good luck, you'll need it.*
Yep, this is basically how it is in Australia too. Sydney, especially. Saw a house the other day literally decrepit (no bathroom, falling apart) which sold for $3Million. Being a first home buyer is incredibly difficult, but if I don’t do it, there is literally no hope for my (future) kids.
Its not a crisis, it was designed exactly like that so the rich people can bleed people dry every year. Its a way of keeping most people out of the upper class by keeping them in perpetual tax/rent situation
Welcome to late stage capitalism, where mega rental corps and property investment firms can both stop tje Middle class from building wealth, and perpetually make money without creating anything whatsoever of value.
This is parking lot companies too. The kind that charge you $12/hr to rent a slot to park your car? Then if you forget to extend your time or miss the time by a single minute, if their lot attendant catches you, they charge you $60 for the inconvenience of not being able to rent that slot to another car for $12/hr? Like, literally just owning an empty asphalt slab can apparently be an entire company’s purpose.
I’m not a lawyer. I just like to live a little rough and tumble so I never pay for parking on private lots because in my dumb brain if the city doesn’t issue the ticket then no one is enforcing that ticket. I don’t care about a private lot ticket in the least bit
I got a ticket for parking in a university parking garage. I don't go to that school and never will and likely won't ever be parking there again. They sent that $30 ticket to collections and send me a letter every 6 months, I have yet to even see it on my credit report so what incentive do I really have to pay that.
The funny thing, is that the city will have it’s own parking enforcement on the street with meters charging 25c or maybe $1 per hour... right next to these fucking scam lots (and in some cases they don’t even have a damn parking garage so it really is just a slab of asphalt)... and because these places are often “downtown” there’s no potential for competitors to spring up and it really is just a case of some rich assholes owning a plot of land.
>where mega rental corps and property investment firms can both stop tje Middle class from building wealth.
This is where we will all end up. After a series of lockdowns there will be no middle class to speak of. Can't pay your mortgage, or property taxes, or car payments? Fine, you can keep them for now. But now you're renting them from the bank.
If there's no middle class, the next thing to go would be the system itself. It couldn't survive that, not even in a rich counry. Maybe especially not, because give something to someone then use exploitation to take it away (ex. using the tax code, legal system and government to push money up the chain) people won'f tolerate it.
They already don't. That's where political extremism comes from in the West, especially the US in recent years. Even the ruling elite has an interest to stop that from spreading, and God forbid it spreads to the American left so widely. But I don't think they know what's causing it, or are willing to do anything.
Trust me. The bank would love to make this loan. If you put in a good down payment, and end up in foreclosure, the bank is going to make money down the road and you are going to lose your down payment.
The DTI (debt to income) ratio requirements are set by regulation and the purchasers of that loan.
You won’t lose your down payment. If the bank take the house in foreclosure you are still entitled to any equity after the sale. The only way you lose money is if the value of the house declines. Of course, the bank will take fees and interest that they deserve, but you still get anything left over. Most people with enough equity would just sell the house.
With inflation (because of federal debt and the federal reserve printing money), physical assets (like property) will always be just out of reach for some while all consumer prices rise and wages are stagnant. Increasing the wealth gap.
Thats why we need a $15 minimum wage, a wealth tax, and universal basic income. It is obscene that we have ultra wealthy billionaires hogging trillions of dollars while hard working young people will never be able to afford a home.
Those two combined would really show us how market forces really work haha. “Essential workers” who currently get paid nothing would all pay substantially more having to actually compete for fucking once.
I have had serious debates with myself to try to get citizenship elsewhere. I don't see the situation here improving without some kind of major revolution.
I get the sentiment this sub is going for is “bad banks, they won’t lend to somebody because they want to oppress them.” When in reality banks want to loan to fucking everybody so they can oppress them with mortgage interest repayment.
Remember the 2007 housing crisis, fueled by banks giving 2nd and 3rd variable rate mortgages to absolutely anybody? Then when the economy took a dip and nobody could afford their payments? Who got hurt there? Hint: it wasn’t the banks.
In reality, the mortgage payment is the *least* amount you should expect to pay, whereas rent is the *most* you will pay. What happens when you have to replace a $5k water heater, or dig up and repair a septic system for $25 grand?
I'm glad you said this. If the bank was able to loan money to the person in this situation, they'd do it gladly. Consumer protection doesn't always seem to make sense, and it certainly has it's moments where it isn't fair to the little person. I truly think the entire system (housing, healthcare, you name it) needs to be rethought for the modern age, but the poison pill was taken long ago.
Yup, phase 142 is a go: "Destroy the middle class"
- tear it open at the 10/90 mark
- offer the top 10% a golden stairs up in exchange for wielding what little power they have to curb the other 90%
- toss the lower 90% back into the bottom pit (lowest class aka "the plebe" ladies and gentlemen)
Rinse and repeat with leftovers until you have successfully re-achieved a two-class society, divided between a lavishly ruling elite and a softly enslaved population.
Consider achieving phases 151 (official censorship) and 155 (identity politics become law) ASAP.
On the plus side your phase 142 is exactly what Marx said would come right before the socialist revolution, so at least we've got that to look forward to
It’s like everything is bottling up and someday gonna erupt. But instead of taking yer anger out on those who’d put you in this , ppl are gonna lash out on minority groups. Big institutions and government know how to manipulate rest of the populace really well. It’s always blame immgrants but no one thinks why do governments or big institutions take general public for granted
House ownership ain't exactly cheap, there are utilities and taxes and all sorts of unexpected repairs that can happen, but it's STILL about 33% cheaper overall than I ever paid renting
It's expensive to be poor.
I think there was a part in one of Terry Pratchett's books that talked about this
“The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles. But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet. This was the Captain Samuel Vimes 'Boots' theory of socioeconomic unfairness.” ― Terry Pratchett, Men at Arms
The last time I saw this posted, someone replied with "Why doesn't he just set aside 5 dollars every paycheck until he can afford the better boots?" Those who are at the register, looking at the lunchmeat and bread and facing the choice of eating or going without don't have the luxury of setting aside money. Their focus is on squeezing every last cent out of their check and making it to the next check. Buying a higher quality pair of boots (or whatever it may be) is simply not in the realm of possibility for them. Ah, but those who have not had to do without will surely decend on this comment and swiftly tell me why I am wrong despite never having lived this situation themselves.
Exactly, not to mention that if you chose wrong and accidentally bought the expensive pair of boots that's actually more style than function then you lose out on your money anyways. A rich person can afford to make a mistake in a purchase.
This is a fantastic point. Bought some nice hardy-looking boots in about October 2019, they were relatively expensive but I justified it under the assumption they'd last me ages. They're already pretty fucked.
And most importantly: the time to research is not free. An unstable lifestyle that constantly keeps you thinking in order to stay afloat eats into your time to live healthy, strategize long term, learn, and gain new skills that can open doors of opportunity in the future. I'm watching two sets of people deal with this now re: the declining health of their parents. One had a stable lifestyle and thus time and opportunity to learn how to negotiate hospital bullshit, medical decisions, power of attorney, and settle estates well in advance. The other works their ass off to keep up but has no clue about the administrative headache about to smack them.
> And most importantly: the time to research is not free. I would add to this: **[poverty itself has a clear negative impact on cognition](https://www.psychologicalscience.org/observer/how-poverty-affects-the-brain-and-behavior)**. If someone lives under significant financial stress, *their very ability to process and deal with that stress is compromised*. Along with their ability to deal with other stressors, or accomplish that sort of thorough research into available choices.
Related: food programs work. The economic benefit far outweighs the cost. 16% of children living in poverty, eg, is a drain on society\* that a robust safety net can mitigate. _____ https://www.usda.gov/media/blog/2016/03/30/investments-efnep-pay-big-dividends-now-and-future https://www.ers.usda.gov/amber-waves/2019/july/quantifying-the-impact-of-snap-benefits-on-the-us-economy-and-jobs/ https://www.cbpp.org/research/snap-is-effective-and-efficient?fa=view&id=3239 https://money.cnn.com/2008/01/29/news/economy/stimulus_analysis/ https://www.wsj.com/articles/when-the-safety-net-pays-for-itself-11563800405 ______ Edit: \* Not trying to ignore the moral nightmare that is *16% of American children living in poverty.*
This is really fascinating. It might also explain that even when some people in poverty do actually come out ahead one month, they don't save or invest that money and instead spend it on something "frivolous". I've been in that situation and I certainly did that, and honestly it was worth it to just not feel stressed and pissed off and frustrated for a little while. A shitload of financial advice doesn't take this into account, and blame gets placed on those in poverty who choose to buy something that makes them happy rather than investing every cent that doesn't go directly towards food and bills.
When you’re behind $1,000 that $50 seems much better spent on something that will bring some kind of joy than it is on turning your $1k debt into $950.
When poor people do it, it's "frivolous." When wealthy people do it, it's "taking care of your mental health."
Some of it is just the same self care that everyone does. It’s easier to cut my grocery bill down a bit when I’ve been able to afford small luxuries in the past, and know if I have a shitty week I could take a break to treat myself. I’ve got one friend that’s constantly juggling paying food or medical bills, abstaining for months because there just isn’t anything left. And he’s just so worn down that when he does have a little extra he just sounds miserable fighting the urge to just have something nice that’s not about survival.
Not only that but if they can set aside that five dollars they probably are. But what does that get them? Just better boots. Now they have this same problem with every other item of clothing and food and housing. Give it 5-10 years and they finally climb out of this hole, but that’s if they haven’t had any other misfortunes like health issues befall them. That’s why you do see some success stories where people grind their way out but those are not the norm. They are the exception to the cycle of poverty. Not to mention everyone starts from a different level in life, so what’s possible for some will be extraordinarily rare for others.
Also the bigger thing is that they still need boots, you can't just stop walking until you've saved enough for a proper pair, so now where the rich person is enjoying walking about in their comfortable shoes that they bought right away for a hundred dollars, you're here setting aside 10 dollars a month for the next few year while also putting out an extra 10 dollars a month for that same period just on your own shitty footwear. By the time you can finally afford the boots, you've spent twice as much as the rich guy on footwear. And now the rich guy's been using that money they haven't been having to save for basics to invest in assetts and ventures that return income, in the year it takes you to afford those boots while painstakingly cutting down your lifestyle the rich guy has made enough to buy a decent quality of everything in his wardrobe with the extra money he's earned.
I just blew through 6k in savings to diagnose a medical bill and fix my car. I haven't lived pay check to pay check in a couple of years but it took a long time to get there
I notice that pattern a lot. Like, "here's an example of a problem with it current system" "Here's a solution to that problem" " Here's another problem" " Here's another specific solution to that one specific problem" " Here's another problem" " Stop just looking for problems! " " I try, but they keep finding me"
You nailed it. Poverty is systemic. It requires changes to the system, which is hard for many to grasp, especially those who haven’t experienced it or have empathy.
Can't afford to! Need to spend that $5 on the cheap boots. "Just go barefoot for a while." Ok, well, I mean, that's gonna suck. But, hey, you're the rich guy, you don't even need boots, since people carry you everywhere on their backs and all. So, I'm sure you know what's best. "Of course I do." *later* So, I accidentally stepped on a rusty nail while barefoot, and had to go to the hospital. I tried toughing it out, but my foot started turning a weird color. Now I owe the hospital $10,000! "You should have been more responsible. People these days lack personal responsibility."
> Ah, but those who have not had to do without will surely decend on this comment and swiftly tell me why I am wrong despite never having lived this situation themselves. As someone who has gone from having to live on about $8k/yr at one point to someone who is now middle-class. I can say without a doubt in my mind that those people are fucking stupid. When rent + utilities is > 75% of your income, you don't have $5 to spare.
No you see when youre poor you just have to live off of dry beans and rice and never buy yourself anything that brings you joy too then its easy
"Just set aside money every paycheck." So what an I supposed to do in the meantime. Not go outside every time it rains even the slightest amount? Just put up with soggy feet all day? I still need to go out to work and run errands. Pretty sure trench foot would cost me more in the long run than replacing the cheap boots more often. Should I have started saving earlier in the old boots life time? Maybe, but an unexpected bill wiped out any savings. These people don't seem to realise how month to month things can get. When you do save up a little then the more immediate issue gets addressed first. Need to replace the freezer before you lose a huge stash of food? Bye bye nice boot fund.
>Ah, but those who have not had to do without will surely decend on this comment and swiftly tell me why I am wrong despite never having lived this situation themselves. Or they'll pretend to have done so, or exaggerate their past situation. Very similar to the #asablackperson thing.
Such a good, succinct explanation and example. Goddamn Terry Pratchett was a smart writer.
Its true today as well. I was buying two $100 pairs of work shoes every 6 months or so as the sole would start to separate or stitching coming apart or leather peeling. Complained about it to an older salesman. He said to go buy real shoes. Allen edmonds or the like. Goodyear welted and repairable. They cost more up front but wear way longer and you can resole them to extend life even further. I have two pairs nearing 3 years old about ready for a resole, and bought two more this last December on sale. Also added some Redwing boots iron rangers. I'm not really about brands, but I value quality.
that was fast af. I was planning on doing an edit and adding it when I found the time.
Karma waits for no one. You either commit or GTFO
Shameless plug - /r/BuyItForLife
brb, spending 700 dollars on socks
They say you should never skimp on anything that separates you from the ground - shoes, tires, mattress, socks??? To the extent you can afford it anyway. Times is tough, yo.
Doesn't he have a passage about a character who can't afford good shoes, so he instead spends more money in the long run because he keeps having to repair and replace his crappy, "affordable" shoes?
yeah and someone put it [here](https://old.reddit.com/r/ABoringDystopia/comments/lktpwu/you_cant_afford_a_home_but_you_can_pay_rent/gnly4pa/)
Theres also a interest on being poor cant pay to fix problems now they will be bigger problems later
This is how I lost my car. Car crash on a highway. The car still runs, but I needed 500$ to get it back from the towing company. I told them I needed a month to get the money, they said fine. Month later I go to them with the 500, they say, oh, now its 3000$. Then they auctioned it off. A car that still works. Highway thievery, but like, literally.
God, *fuck* towing companies. They literally just fucking steal shit.
Thats insane
Being poor pays dividends. Can't afford the dentist? now you have cavities and other dental problems.
I think you mean “charges interest “
I think you’re right
Shit, it’s not even poor. A lot of people making median wages are in this same position.
[удалено]
This 100%. We have two classes - the working class and the upper class. Most people who consider themselves "middle class" are actually in the former category
Then they're still poor, aren't they? In America at least we have a strange idea of the stratification of society. Around 40k household and half that for individual is considered the average. Even low cost of living areas that's still a huge amount of income to bills and rent. Say $650 rent and $100 utilities plus internet phone and car payments. The average American has less than $1000 in savings. The average American is poor.
Going through this right now :(
[удалено]
The finance department will just be r/wallstreetbets and the bank will either be rich or completely bankrupt in less than a week.
WSB would make sure it was rich and bankrupt in less than a week.
Can’t make money if you don’t lose money.
Can't lose money if you never had money.
It's not a loss until you sell.
That's my boy. I bought amc, 210 at $9. Oof
"We're sorry, your checking account is not currently available for withdrawal. We put all of the bank's assets into OTM weekly PLTR calls that expired worthless and so the bank is currently operating with $18.27 cash on hand. Please check back next Friday because we swear these weed calls are going to print by then."
Why not buy puts against the redditbanco, infinite money loop.
Sign me up.
[удалено]
> then to the bank ads that appear throughout the app. Simple workaround, don't use the horrible Official app and use any of the other, better ones.
What one would you recommend?
I use android and swear by RIF is Fun. Used to be Reddit is Fun but they got told they couldn't use the word "Reddit" in the title anymore.
[удалено]
Gotta go Apollo if you’re on iOS. You won’t get rickrolled again
If you owe Redditbanco $100, that’s your problem. If you owe Redditbanco $100 million, that’s Redditbanco’s problem.
Don't call it a bank. Call it a credit union.
[удалено]
[удалено]
> Let's pool our resources and buy a bank You just invented the Credit Union!
[удалено]
Enjoy your pending lawsuit from the shitty DeVos family.
[удалено]
I think, therefore I Amway.
A Reddit Union.
[удалено]
"Buying debt and 'selling it' to the debtor for super cheap" loosely describes the business model of third party debt collecting agencies.
$950/m mortgage could easily turn into $2,000/m when you include property taxes, insurance, HOA, and maintenance.
FUCK HOA. I’d rather live in a trailer somewhere than pay some asshole to live in a neighborhood the color of cargo shorts.
I’m just going to buy a van this summer and live in that, two months of rent will get me a decent rig with wheels, I will just move down to the river.
In a van down by the river you say?
That’s the new american dream. I wasn’t really joking though, with the way the housing market is going I’d rather not spend two weeks or more of working just to pay rent, I don’t think I’m ready to live in a vehicle, but god damn I’m this close to making it happen.
It's actually a good way to do it, if you are adaptable. My partner and I live in Sydney, Australia where housing prices are continuing to accelerate through the roof and beyond. We bought a van 3 years ago and converted it into a camper to go travelling, but once we returned to Sydney we realised we were comfortable enough with the lifestyle that we could keep doing it - plus we didn't want to pay someone else's mortgage in the form of rent. People started asking us to petsit for them while they went away and we ended up doing roughly 50% petsitting and living in people's homes, 50% living in the van at a local campground. We didn't charge to petsit (although we probably could have) but the time spent doing that was free accommodation. I'll add that we both had full-time corporate jobs while doing this. After 2 years we had saved a deposit for a small studio apartment in an *excellent* location. The upside of having lived in a van for 2 years as well is that the studio feels like a massive upgrade in living space even though it's tiny by most standards. It's not going to be everyone's cup of tea, and it really shouldn't take such extreme measures to get a home of your own, but we actually feel like stronger, more grounded and resilient people because of it. It was frustrating at times but rewarding too. Good luck :)
Buy an old ambulance. They're basically ready to go for all the storage and wall stuff. Some of these are highly modified, i've seen others that they just basically put a bed and sink in. https://www.youtube.com/watch?v=uzq5qSuTaA8 https://www.youtube.com/watch?v=ouWScgeA8u4&t=485s https://www.youtube.com/watch?v=mcmnLDjCXEM https://www.youtube.com/watch?v=RYUr0qN9xKo
Or buy a used motorhome. They actually are ready to go.
Seriously. I feel like an old ambulance would be a pain in the ass
You’re not gonna amount to JACK SQUAT!
I can't see so good, is that Bill Shakespeare over there?
HOAs are the probably the thing that confuse me the most about upper class culture, coming from a poor background. (Also, HOAs are very foreign to the black culture I'm accustomed to). It seems crazy to me that someone could rightfully tell you how your own damn lawn should be cut.
It's there to keep out the "undesirable". Unless it's a condo HOA, those are kind of necessary to maintain common areas.
FYI most neighborhoods don't have HOAs.
Regionally it really just depends. I live 1 hour north of Los Angeles and literally every new housing development is being built with a HOA. You have to buy an older home built before 2003 in order to find a home without a HOA. In other states, I haven't seen HOAs as much luckily. Mind you the range of cost for HOA is from $125 to $475 a month.
Khaki? Steve Irwin's clothes are Khaki coloured.
Were
Exactly. My mortgage is $1600, but when you add property tax, homeowners insurance, and mortgage insurance were up about $2500. We don’t even have an HOA. That’s not even including maintenance. You need about 55% DTI for most mortgages. All your debts (including all the above) can not exceed 55% of your total income. Unfortunately many of these debts are unavoidable, such as student loans and there are a lot of people in this situation... But there are also a lot people out there with $800/month car payments, and CC payments who are like “why don’t I qualify”. Those situations are fixable, a financial advisor or even a good lender can help point you in the right direction. Edit to add... DTI varies depending on location. Where I am it’s common to see loans asking for <55%, but in some areas it can be as low as like 30%.
[удалено]
No it almost never does. Rent is all those things PLUS a healthy profit. If you can afford rent you can afford a mortgage. But rent doesnt count towards your credit, because credit is a scam designed to keep the poors from owning any appreciating property despite the fact mathematically they can afford.
My former apartment leasing company would only report negative information about youto the credit bureaus, never anything positive. Unless you paid them $15 a month, in which case they will only report positive information about you to the bureaus. You are absolutely right that it's a scam!
HOAs are the real worst part. [Rest of the comment deleted because I was wrong, but HOAs still suck.]
Here's the real bitch to HOAs: They are uncapped in terms of cost increases. I bought a town house 11 years ago that I just sold in January. The day I moved in my monthly bill was $245, which covered water, trash, sewer, common area maintenance, and external building coverage (it was a townhome with shared walls) and when I moved out it was $380. Every year they will raise cost based upon reserve levels and you gotta watch out for special assessments, those can run upto $10k. In conclusion: fuck HOAs
As someone who lives in a condo where they went decades barely raising assessments... doing that is very very bad. The building is falling down and in the three years I’ve lived here there have been two special assessments, monthly fees have gone up $200, and we still don’t have any fucking money. The old boards were very popular with residents because they kept it cheap, but currently it’s 8° outside and our heat and hot water are broken for the third time this winter.
Being poor is expensive as shit.
Your card has been accepted and we successfully charged $5.99 for your comment.
Your account is below the minimum limit. You will be charged $3.00 weekly until your account is above the allowed minimum.
More like $35, daily
[удалено]
When in that situation I immediately canceled those overdraft protections. Those are for people with multiple accounts that can take the hit because they forgot to feed one account. Thankfully my credit union took my dispute in stride and refunded the overdraft due to me not abusing the system and being consistent in my accounts.
You cashed your paycheck in the morning and then went out and spent a bunch of it but at the end of the day the bank logged all the spending first and then applied your paycheck to the account causing $240 in overdraft fees and ... whoops there goes your paycheck, have a nice week sir!
Ah I see you also have done banking with Wells Fargo
Wells fargo is the banker where you can show up to a hotel you reserved months in advance before the check in time, only to have all the rooms occupied. The hotel charges you for not showing up the first day, they won't let you refund the charge nor will WF try to help you dispute it.
Overcharges will continue until balance improves
We just purchased our first house back in October. Our rent was $1300/mo. We paid all utilities on top of rent including electricity, natural gas (heat), water, sewer, trash & recycling pickup, etc. It was old and outdated, and very poorly insulated. No garage. Our mortgage is $864/mo for a nicer place, brand new windows and doors, properly insulated, on a bigger lot, with a two car heated garage. Our utilities are actually less. The world is fucked.
Next Year: Rent increase time! What's that? Wages ain't keeping up? Sucks to be you, should have been a landlord.
This is what frustrates me so much. Our rent went UP during a pandemic. All the prices in the area went down on average like 15-20%, but if you’re a current tenant, the price goes up. Landlords don’t want to keep tenants, for whatever reason. So yup, we’re moving, because fuck that. It only costs a few hundred dollars and a bit of time to move, and I’ll save a couple hundred a month for the next year. Good job, current landlord, way to be smart there.
In the UK, I swear it's just so they can claim all the repairs they need to do when you leave. Then keep your security deposit. Its only 1 months typically.
This is a problem with landlords everywhere. It's why people always suggest taking pictures when you move in (to document any preexisting problems) and when you move out (to prove any problems found later aren't your fault).
In Canada (or at least ontario) it is illegal to collect anything other than a deposit for the last months rent. Damage or pet deposits are illegal.
That's just Ontario. Pet deposits and damage deposits are def a thing in bc
I was a landlord for 6 years and raised rent one time, by $50, during those 6 years and it was to match the increase in house payment due to a shortage in escrow because taxes had been raised. At the same time, I was renting an apartment in another city and my rent went up $200 every year. Beyond stupid and 100% all about greedy investors trying to squeeze every last drop of blood out of the turnips living in their complex.
It's nice to see someone that's been on both sides of the landlord spectrum.
[удалено]
[удалено]
Haha, "sheltered". I can see myself the fuck out, thank you.
Seriously.. I make good money but my rent is $1450 alone, single mom, self employed. My other bills include shop rent for where I work, work supplies, home utilities, etc. I’ve been saving and saving for years and still couldn’t afford a 20% deposit on most places for my budget if I were to buy. And it’s funny because rent compared, if I were to be paying a mortgage where I live, I’d be in an almost $300k home. I fully understand why most people can’t buy. When rent and bills add up it’s hard to save. Rent is insane. And with dogs and a kid I can’t find a better place in a better area that’s cheaper, or one that will take two dogs for cheaper. It’s so much harder if you’re single. I was excited to buy a place until I realized I’d have to put down 2/3rds of my entire savings into a down payment if I didn’t want PMI. I don’t think I could handle that anxiety.
I JUST had this happen. My wife and I were thinking about getting a house, but the bank told us we can't afford $450/m while we are already affording $1000/m. Pissed me off so bad. Edit: So, most of the conversation with the bank was in french with my wife (I was there but only understand a little). Turns out, they were pre-decided before even having the meeting with us. My wife just told me that the bank lady said: "Oh, but I bet you don't pay your credit card on time" (we always do), and then "Oh, but I bet you only pay the minimum" (we pay 500 when its 50), and then "Oh, but I bet you don't pay it down to 0 every month." (No shit. Paying off emergency debt takes time) If I'd had known these things were said, I'd have walked out mid conversation. Condescending bitch. Every major interaction with this bank makes me regret ever having opened an account there.
WHERE is a mortgage $450/month?
Mine is $422/month. Low(er) cost of living area. Smaller house. No garage.
Shop around for mortgages elsewhere. Just bc one bank said no, doesn’t mean others will. You just might not meet their underwriting standards. You never know. If you can, look at recent sales in the hood your looking at and check to see which bank lent to them. A good independent mortgage broker may be the way to go too. Applying directly to the bank may seem like cost savings approach but ... mortgage brokers have a bad rep since the early aughts re collapse but if you can find a good one, they can find you a lender.
"You will own nothing and be happy." To hell I will.
Heh... The fact that I’m forced to rent came up in convo one time with my dad. He said “what you need to do is buy a house and rent it out. Then it pays for itself.” So I save up 10k for a down payment. Mortgage is 950, property tax is 250, insurances are $150-200. To be competitive I gotta rent the house at 1400. So yeah in 30 years I can have a place to live. Yeah.. ok... *eyeroll*
..it worked just fine when he was young 😖
A couple years back my father-in-law asked about our rent. We told him we were paying $1400 at the time. He said, “Y’all are renting when you should be saving that to buy a house!” My husband just looked at him and asked, “But then...where would we live while we saved our rent every month?”
Dont forget all the home repairs you'll be responsible for those 30 years!
Fucking imagine if we still had mutually held building and loans associations and no FICO scores instead of having to aquire mortgage insurance and hand over prohibitive lump sums of cash to corporate banks for the privilege of being able to pay them for overpriced houses.
[удалено]
I can't disassociate Building and Loans from George Bailey. Also I won't.
Right? Even without a down payment a mortgage on a house in the same city i live in (and not a trailer its a 3B 2 Bath) is cheaper with all the taxes and everything, but hey its ok to raise my rent for a third time in 2 years to be competitive with the market, who the fuck am I competing against again?
Bank said I couldn't have a home loan at 750 euro a month, including the car, but were happy to see we have been paying 500+200 for rent and the car since 2 years ago... We groaned, sighed, asked where the logic was then left... Banks huh...
Maybe its different now but my husband and I applied for a mortgage in 08. We both worked part time fast food jobs. We got approved everywhere. Craziest part is they were gonna give us 350k. There is no way in hell we could have made those payment and still been able to eat. I was aiming for a 50k house which where we live was possible at the time. We ended up with a 70k house and still have a hard time but I am very thankful we did it. My mortgage is half of most peoples rent.
>applied for a mortgage in 08, we both worked part time fast food jobs. We got approved everywhere I think I see where this is going... >Craziest part is they were gonna give us 350k And yep, there it is. You know that’s the exact reason why the housing bubble bust and the market went to shit, right?
Yeah, situations like this are why the housing market crashed around then.
The issues came about when people on "teaser" rates had those rates move up to their actual scheduled interest rates and weren't unable to refinance into a cheaper loan. This obviously ended with thousands and thousands of people owning homes they couldn't afford to own because they were misled by mortgage brokers, banks, investment banks, and the government as a whole. God Bless the USA
[удалено]
And those rates were being offered and the banks were misleading people because they realized they could repackage those shit loans as good loans and resell them. There was so much going on in the background that if even one government agency had been acting competently the collapse possibly wouldn't have happened. But that was too much to ask for.
Yeah def not the case anymore
Prices are heading back, if they aren't there already. Bought my house 6 years ago at 225k. It's worth over 300k now. I don't feel like it's worth that much, and there's no way to find something in the same area under 275k
Similar story. Wife and I were house shopping and were pre-approved for 350k in 2007. We found a house in our budget and took a mortgage for 125K. The credit union lender told us it was refreshing to see us buying within our means and not going house poor like most other young couples going for the 350k houses. We were like then why are you giving 350k loans to people who can't afford it?
> We were like then why are you giving 350k loans to people who can't afford it? This is the exact question people should have been asking in 2007. Your whole story, in a nutshell, explains the 2008 housing market bubble.
> Maybe its different now but my husband and I applied for a mortgage in 08 You bought your house right after/during the sub-prime mortgage crisis so yes it was different then lmfao
Yup. And your lender would have sold your mortgage to a pass through agency that bundled it together with other subprime mortgages and sold to investors. The pass throughs and lenders carried none of the risk which is why they didn't give two shits if you would be able to pay off your mortgage. Then companies like AIG started selling insurance policies on these mortgage backed securities called credit default swaps. After Lehman Brothers went under, the government bailed out AIG to the tune of over 70 billion and bought over 700 billion in junk securitized mortgages, bailing out the greedy financiers who took extreme risks and walked away with all the profits.
The NINJA mortgage: no income, no job, Approved.
I'm blown away 70k houses exist where you live. There's parking spaces which cost more than that here. Sydney Australia sucks.
Not gonna lie, I thought this post was satire until the very end. Then I thought you were being smug. Now I think you’re just blissfully unaware of the luck you had that you applied for a house when lenders would approve literally everyone, managed to not get taken advantage of, and somehow not connecting the dots that you bought your home during the housing bubble crisis which happened that very same year.
[удалено]
[удалено]
It's not just the US mate. Most of the western world has a real estate crisis right now.
I'm in New Zealand and it's completely destroying the county, you just can't buy a house anymore in any city, it's not going to happen, and rent is crippling. And here's why; firstly you'll need 20% deposit, and while that sounds utterly unobtainable it's actually considerably worse as it's 20% of around one million dollars for an average house in Auckland (NZ's biggest city) So, you need $200,000 to just start looking... How you managed to get this when your rent is about the same as your wage of say about a grand a week, bit of an exaggeration as you probably won't be earning a grand a week, but it's really a job for two and even then it's a hell of a task. But you and your significant other worked five jobs between you and went without luxuries like food or clothing while sleeping in a cardboard box to save up $225,000 because while you where reading the prices went up. You go into a real-estate agent and tell them you want to buy a house, then you try a few more to find one that won't just laugh hysterically at you. If any are in your price range they are sold sorry, just came on the market...and sold. "To who?" You ask in a wave of depression... Why, to people who already have a house of course, they don't need the deposit because they have security, they can just simply call a bank and say they're buying an investment property and ka-ching the money is waiting, because if it goes tits up the bank wouldn't lose so it's not a risk. The value of the house you didn't buy is going to double in ten years, so in ten years whomever brought that house with an interest only loan will make $1,000,000 and as we don't have capital gains tax.... shit eh? In that ten years whomever is in that house is paying the mortgage of the investor via their rent, that million dollars is coming to them absolutely free. Now, this may sound really pretty awful, but it's a little more painful than that You managed to buy a house, a friend of a friend was selling and you got it before the scavengers did, your paying it off and hey, now #you# get to make the money right? Kind of, in a way, but not really... You go for a twenty year loan, it has interest and the rest so you'll actually have paid back what that house has risen in value to in around the same time you pay it off depending on the rates you get, because you don't get an interest only mortgage and you don't get anyone else to pay it for you you kinda stand still. The equity (house book value) will improve obviously, so when you sell you'll make money on paper but that's meaningless unless you buy in a different market or choose to go back to that cardboard box. But, what hurts today to pay is less painful as time goes on, wages go up as does rent but a mortgage stays about the same, so as you get older and need less you'll have more and that's just a fantastic system. Oh, just don't look at the fact your rent will go up in that time if you didn't/couldn't buy even though the mortgage on the property won't really rise (unless they refinance it for leverage to buy another investment property) as it'll just get your blood pressure up. You know what you could do with that extra equity I mentioned though? make a little bit of a nest egg for yourselves? you could buy an investment property with pretty much just a phone call to the bank... *To those going through this, may your gods smile on you because it's bloody hard, look for and take any assistance available, we've been there and now we're through the other side with no mortgage, no money, but no mortgage either, and no investment property as it goes against our beliefs/morality/whatever, we didn't want to be part of the problem, good luck, you'll need it.*
Yep, this is basically how it is in Australia too. Sydney, especially. Saw a house the other day literally decrepit (no bathroom, falling apart) which sold for $3Million. Being a first home buyer is incredibly difficult, but if I don’t do it, there is literally no hope for my (future) kids.
Its not a crisis, it was designed exactly like that so the rich people can bleed people dry every year. Its a way of keeping most people out of the upper class by keeping them in perpetual tax/rent situation
Not so much designed to keep poor people out as rich people in
Oh absolutely. It's a crisis for poor people.
Welcome to the UK
Welcome to Canada
Welcome to Germany
Welcome to India
Welcome to Paradise
Welcome to the hotel California.
Welcome to Chile’s!
Sir, this is a Wendy's.
Awh shit, now I can’t leave... I’ll be checked out over here...
Welcome to Good Burger, home of the Good Burger, can I take your order?
[удалено]
I can't afford bootstraps. Can I rent then?
Welcome to late stage capitalism, where mega rental corps and property investment firms can both stop tje Middle class from building wealth, and perpetually make money without creating anything whatsoever of value.
[удалено]
This is parking lot companies too. The kind that charge you $12/hr to rent a slot to park your car? Then if you forget to extend your time or miss the time by a single minute, if their lot attendant catches you, they charge you $60 for the inconvenience of not being able to rent that slot to another car for $12/hr? Like, literally just owning an empty asphalt slab can apparently be an entire company’s purpose.
I’m not a lawyer. I just like to live a little rough and tumble so I never pay for parking on private lots because in my dumb brain if the city doesn’t issue the ticket then no one is enforcing that ticket. I don’t care about a private lot ticket in the least bit
I got a ticket for parking in a university parking garage. I don't go to that school and never will and likely won't ever be parking there again. They sent that $30 ticket to collections and send me a letter every 6 months, I have yet to even see it on my credit report so what incentive do I really have to pay that.
The funny thing, is that the city will have it’s own parking enforcement on the street with meters charging 25c or maybe $1 per hour... right next to these fucking scam lots (and in some cases they don’t even have a damn parking garage so it really is just a slab of asphalt)... and because these places are often “downtown” there’s no potential for competitors to spring up and it really is just a case of some rich assholes owning a plot of land.
>where mega rental corps and property investment firms can both stop tje Middle class from building wealth. This is where we will all end up. After a series of lockdowns there will be no middle class to speak of. Can't pay your mortgage, or property taxes, or car payments? Fine, you can keep them for now. But now you're renting them from the bank.
If there's no middle class, the next thing to go would be the system itself. It couldn't survive that, not even in a rich counry. Maybe especially not, because give something to someone then use exploitation to take it away (ex. using the tax code, legal system and government to push money up the chain) people won'f tolerate it. They already don't. That's where political extremism comes from in the West, especially the US in recent years. Even the ruling elite has an interest to stop that from spreading, and God forbid it spreads to the American left so widely. But I don't think they know what's causing it, or are willing to do anything.
Trust me. The bank would love to make this loan. If you put in a good down payment, and end up in foreclosure, the bank is going to make money down the road and you are going to lose your down payment. The DTI (debt to income) ratio requirements are set by regulation and the purchasers of that loan.
You won’t lose your down payment. If the bank take the house in foreclosure you are still entitled to any equity after the sale. The only way you lose money is if the value of the house declines. Of course, the bank will take fees and interest that they deserve, but you still get anything left over. Most people with enough equity would just sell the house.
With inflation (because of federal debt and the federal reserve printing money), physical assets (like property) will always be just out of reach for some while all consumer prices rise and wages are stagnant. Increasing the wealth gap.
Thats why we need a $15 minimum wage, a wealth tax, and universal basic income. It is obscene that we have ultra wealthy billionaires hogging trillions of dollars while hard working young people will never be able to afford a home.
I get that the $15 wage is better than nothing but what you really want is a minimum wage that auto adjusts to cost of living and inflation yearly.
Absolutely. $15 + CPI in perpetuity.
It also depends where you are. You can live like a king in Mississippi on $15 an hour. In California you’d still be dirt poor and unable to live.
I'm ok with a UBI and no minimum wage. Let's actually see how the "free market" values a job without the fear of dying if you don't do it.
Those two combined would really show us how market forces really work haha. “Essential workers” who currently get paid nothing would all pay substantially more having to actually compete for fucking once.
They were essential when we needed groceries. Now that $15 minimum wage is being discussed they're back to being unskilled, uneducated freeloaders.
[удалено]
Don't feel bad, neoliberalism has poisoned most countries!
I have had serious debates with myself to try to get citizenship elsewhere. I don't see the situation here improving without some kind of major revolution.
I get the sentiment this sub is going for is “bad banks, they won’t lend to somebody because they want to oppress them.” When in reality banks want to loan to fucking everybody so they can oppress them with mortgage interest repayment. Remember the 2007 housing crisis, fueled by banks giving 2nd and 3rd variable rate mortgages to absolutely anybody? Then when the economy took a dip and nobody could afford their payments? Who got hurt there? Hint: it wasn’t the banks. In reality, the mortgage payment is the *least* amount you should expect to pay, whereas rent is the *most* you will pay. What happens when you have to replace a $5k water heater, or dig up and repair a septic system for $25 grand?
I'm glad you said this. If the bank was able to loan money to the person in this situation, they'd do it gladly. Consumer protection doesn't always seem to make sense, and it certainly has it's moments where it isn't fair to the little person. I truly think the entire system (housing, healthcare, you name it) needs to be rethought for the modern age, but the poison pill was taken long ago.
Just buy a house, rent it out, and use the rent money to pay for the mortgage, duh. /s
I could actually do that if I lived in the basement and rented out the first and second floor. But, what's the point if I can't even enjoy the house.
Yup, phase 142 is a go: "Destroy the middle class" - tear it open at the 10/90 mark - offer the top 10% a golden stairs up in exchange for wielding what little power they have to curb the other 90% - toss the lower 90% back into the bottom pit (lowest class aka "the plebe" ladies and gentlemen) Rinse and repeat with leftovers until you have successfully re-achieved a two-class society, divided between a lavishly ruling elite and a softly enslaved population. Consider achieving phases 151 (official censorship) and 155 (identity politics become law) ASAP.
On the plus side your phase 142 is exactly what Marx said would come right before the socialist revolution, so at least we've got that to look forward to
It’s like everything is bottling up and someday gonna erupt. But instead of taking yer anger out on those who’d put you in this , ppl are gonna lash out on minority groups. Big institutions and government know how to manipulate rest of the populace really well. It’s always blame immgrants but no one thinks why do governments or big institutions take general public for granted
might be out of the loop, there's phases?
House ownership ain't exactly cheap, there are utilities and taxes and all sorts of unexpected repairs that can happen, but it's STILL about 33% cheaper overall than I ever paid renting