OT: Drop in value of homes

[hallerb]

when the feds in pure greed removed the credit card interest deduction it pushed many into rolling debt into their home.

know people who have done that over and over.

that explains how people can live in a home for 10 to 20 years and still owe more than its worth.

greedy credit card companies, greedy mortage companies, often the same companies looking only to boost the short term bottom line can sink our economy.

i am mnone of these, our mnortage is paid off, very little overall debt.....

not everyone is overspending, but all pay the price when things go bad

[Edwin Pawlowski]

Why are they greedy? People sign up voluntarily to use their services. No one forces people to pay 21% interest. Cash still works.

[dpb]

Credit card interest was _NEVER_ deductible so you'll have to find another excuse for the poor decisions made by consumers.

--

[SteveB]

I see a proliferation of "pay day check services" in my town. Las Vegas. I even see them in very conservative Southern Utah. These people are the kings of legal loansharking, and they get away with it, and are condoned by government because they pay a fee or % to the state. Anyone who walks into those places are surely brain dead, yet they go in there and sign up for loans at high rates.

It's just the new morality. Get it now, pay for it later. No waiting. No delayed gratification. You "need" that new car NOW, and you need to be paying $500 a month for it plus insurance, even though you'll still be upside down in it in two years.

But you look good.

You need new socks, haven't had your teeth cleaned in three years, and don't have a penny in any form of savings/investment. But you need to look good and feel good about yourself.

Steve

[hallerb]

it was deductible up till 5 or 10 years ago. to help the government deficit it was moved to non deductible

[hallerb]

Vegas. =EF=BF=BDI

=BDNo waiting. =EF=BF=BDNo

well since companies like citibank lost billions they are upping credit card rates, late fees, penalties and interest without warning. this will only make the economy worse.

gasoline is costing me a fortune, $3.20 a gallon and rising. i have no choice i drive all day repairing office machines

[dpb]

That is just incorrect. Mortgage interest is deductible, personal debt interest is not (and has never been).

Second mortgages and other forms of rolling improvements into mortgage vehicles have been in existence far longer than this for precisely that reason.

[Erma1ina]

Credit card interest was deductible until the 1986 tax reform bill. =

Check it out at various sites, for example:

"On Oct. 22, 1986, President Ronald Reagan signed into law the Tax Reform Act of 1986. Reagan called the 829-page, 33-pound bill 'the most sweeping overhaul of the tax code in our nation's history.' =

"The new code gradually phased out all deductions for interest paid on car loans, charge-account purchases, vacations and anything else that fell under what the law termed 'consumer loans.' =

"The sole exception was interest payments on home loans. At the time, according to Mark Green, a spokesman for the Internal Revenue Service, Congress believed deductions for personal interest encouraged people to consume and stifle savings."

[Kurt Ullman]

Actually credit card debt become non-deductible during the 80s.

[aemeijers]

Making rational financial decisions like that? What a concept!

My mortgage broker told me I was qualified to borrow over twice what I came in the door looking for, and he had all the flyers for the unconventional mortgages. But his heart wasn't in it. I told him that I had been poor before, didn't care for it, and was going to try like hell to avoid doing it again. He looked relieved. He wrote the paper for 100 grand and change (w/20% down), and all together the red tape took maybe an hour. It ain't a fancy house, but I live alone, and my needs are simple.

They make plenty of money writing realistic mortgages, and it was nice to see a broker with the ethics to at least feel bad about the instructions from corporate to fleece the rubes as much as possible.

-- aem sends....

[Oren]

It was until the Regan tax reform of 1986. I think even interest for auto loans.

See US Treasury Dept.

-- Oren

[<h>]

There&#39;s an ad for one of those "cash now" services on TV, and in microscopic print it says 99.5% APR. No, that&#39;s not a typo. I did the math on that for the "average" loan amount they listed of $2,500.00 for their "average" loan length of 42 months. There&#39;s a $75 loan origination fee (an origination fee for $2,500!), $9,025 in total payments ($215 per month), so you end up paying $9,100 on a $2,500 loan. Who on earth could be that stupid?

[<h>]

Wrong. I have tax returns from the 1980s clearly showing credit card interest deductions and they must have been legal since there&#39;s a place for the deduction on the preprinted form. You must just be too young to remember.

[hallerb]

the bottom line,

for those who arent concerned relax and enjoy the ride but DONT complain if your hurting too by the time things bottom. perhaps unemployeed or underemployeed, perhaps you will need to sell your home for one reason or another and find not only is its value down, but buyers who are interested cant get a loan.

or so many end up out of work the cost to those still working skyrockets for socia services to help the unemployeed.

or perhaps what will bug you is that as government pumps money into our economy, the value of our dollar tanks and foreigners own and COINTROL the country.

true lack of personal responsiblity for both buyers and lenders caused the trouble, along with federal regulators ignoring the siituation.......

but this mess can and likely will hurt each and every one of us.....

stocks can go down just as easily as up..........

[Oren]

Ever thought of purging those files?

-- Oren

[tmclone]

When you have an ex who pops up every few years claiming that you owe him money for taxes and other payments from 1978-1989, you never throw out ANY financial record created during the marriage. No matter what ridiculous claim he makes, I have the paperwork to prove it&#39;s bogus. Anything from 1990 on, however, gets tossed after seven years.

[Nate Nagel]

You missed the window, rates were 5.5% a couple weeks ago but are back up now. We locked in the 5.5% but are still waiting to find out if they&#39;ll give it to us (hinges on appraisal) because like you we don&#39;t have the extra cash if we need to kick anything in at closing.

nate

[Oren]

You could have shot the guy in &#39;78, and been out of jail, by now!

-- Oren

[<h>]

He SO isn&#39;t worth the cost of the bullet. Besides, it&#39;s not like I&#39;m not able to prove I don&#39;t owe him a dime.

[Edwin Pawlowski]

Wrong. It was many years ago. Credit card companies even gave you a statement of how much you paid for the year. Car payment interest was deducible also. I think it was in the late 70&#39;s, maybe 1980 that the tax code was changed to eliminate those deductions.