| Oct 7 @ 2:19 PM |
economic lies about the economy...
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Gallows_Humor
Posts: 8,063
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I watched some talking head ranting on while channel surfing yesterday... and could not believe the statements that are coming out...and the way it is being spun..
a couple of  them were
...that if you vote obama..into the white house the recession will last for his whole term.. but if you vote in McCain.. it will be short lived as ....................  there was no reason given...
another one was... that student loans would dry up very soon ... and then colleges would have to drop their tuition rates....
again.. no justification given... just talking heads talking...
still another said that if you tried to sell your recently purchased house because you lost your job...
you would not ....because of the faltering economic situation...recoupe your down payment of 10 percent...
news flash in the old days of no bubble.... it would take years to recoupe your down payment as
! ) just the act of selling a home one incurrs sellers costs.. which is deducted from ones proceeds at closing.....
2 )...most of the 10 percent down payment went towards closing costs and very little went towards principle...
so.. buying a home and selling it in the first 5 years usually meant that one lost money............until the bubble
it was recommended that if you knew you were going to move within a 5 year time frame.....to rent, and not buy as it was always less expensive...
anything that you have heard that just makes you go......"Hmmm.....what has he been smoking??"
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| Oct 7 @ 3:48 PM |
economic lies about the economy... |
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KatiefromStafford
Posts: 2,266
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As the Dow falls by almost 400 points... down to 9572.. but hey, the economy is strong, John..
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| Oct 7 @ 4:05 PM |
economic lies about the economy...
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Gallows_Humor
Posts: 8,063
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Katie...you worry tooo much.. the stock market was artifically inflated too.. the price of stocks have nothing to do with the day to day running of a company unless they are needing the inflated valuation to borrow against...
the days of "easy money" are over... that is all.... the price of food.. basic shelter and utilities will remain unaffected by all this...
it is the upper class that is hurting (and  )...as they see their personal (inflated) portfolios dropping in value....
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| Oct 7 @ 4:11 PM |
economic lies about the economy... |
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Heaveninawildflower
Posts: 15,333
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Well, trickle down does trickle down...as there's less discretionary income to dispose of, the 'upper class' will buy less, build less and need fewer services. This will trickle down to the shopkeepers, etc. There will be fewer and less lucrative jobs available, etc.
We're all in this together - if you think you won't be affected, I think you need to think again.
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| Oct 7 @ 4:13 PM |
economic lies about the economy...
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KatiefromStafford
Posts: 2,266
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now down 500 points, and this is affecting the world markets..
and yes it does affect me, because it risks me losing my job.. that affects me..
drives up the price of necessities, that affects me.. 
Wow, who would have ever thought a sitting President could be an honest man..
President Bush, in a speech today, said that some of the subprime mess is the result of the need for folks to understand the language of lending documents. And the lack of disclosure on the part of the lenders to explain that those great subprime notes would go through the roof in a few years.. good for him.. 
[Edited on 10/7/2008 4:26 PM]
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| Oct 7 @ 4:54 PM |
economic lies about the economy... |
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capobeachguy
Posts: 3,658
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2 )...most of the 10 percent down payment went towards closing costs and very little went towards principle...
Who said this?
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| Oct 7 @ 5:00 PM |
economic lies about the economy...
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Gallows_Humor
Posts: 8,063
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I did........ 
and they did too....
http://www.thinkglink.com/Buyer_Closing_Costs.htm
remember Capo...I am talking pre bubble prices..... 
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| Oct 7 @ 5:03 PM |
economic lies about the economy... |
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KatiefromStafford
Posts: 2,266
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Lol, G-H, after looking at that site for a few seconds, I am so glad I will never have to worry about buying property again! 
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| Oct 7 @ 5:07 PM |
economic lies about the economy...
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capobeachguy
Posts: 3,658
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Where does it say that the down payment is applied against the closing costs?
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| Oct 7 @ 5:14 PM |
economic lies about the economy... |
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Nightowl001
Posts: 4,134
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Where does it say that the down payment is applied against the closing costs? Capo, you're arguing apples and oranges. It doesn't matter where the closing costs are assessed. For many, many years pre-bubble the conventional wisdom was that you would probably wind up making no money, or even losing money, if you sold in less than five years, unless you managed to do something that greatly increased the value of the house.
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| Oct 7 @ 5:18 PM |
economic lies about the economy...
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capobeachguy
Posts: 3,658
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Nightowl, YOU are the only one discussing fruit.
I asked a simple question, "Where does it say that the down payment is applied against the closing costs?" as it applied to a prior statement by GH.
If you don't know the answer either, you would be better served by posting in another thread. GH's statement was completely erroneous.
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| Oct 7 @ 5:27 PM |
economic lies about the economy... |
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KatiefromStafford
Posts: 2,266
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Then, Capo, please educate me, where does the down payment go, and how much of that could I recoup if I sold in less then 5 years?
Say I put down $30,000 on a $150,000 house (like there are any of those around here >.< ), how much could I reasonably expect to get back in the event I sold in less then 5 years?
[Edited on 10/7/2008 5:31 PM]
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| Oct 7 @ 5:29 PM |
economic lies about the economy...
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Gallows_Humor
Posts: 8,063
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If you don't know the answer either, you would be better served by posting in another thread. GH's statement was completely erroneous.
 yeah right..... now you are an old school mortgage lender...
you are not....
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| Oct 7 @ 5:30 PM |
economic lies about the economy... |
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sealacamp
Posts: 3,151
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the economy is strong, John..
That is not what he said twister. He said the fundamentals were strong and they are. What drives this economy is people and the items that are bought and sold. The fundamentals have not changed yet. Perhaps they will but they have not changed yet. John did not say the economy was strong. Maybe you need a hearing aid.
S
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| Oct 7 @ 5:32 PM |
economic lies about the economy...
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Nightowl001
Posts: 4,134
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No, capo, you're trying to separate out a distinct definition of "down payment" that disagrees with what GH said, and its disingenuous. If a borrower walked into a real estate office and said, "I have exactly $8000 to put down on a house," they would figure out a way to get that borrower into a house for that $8000, with the borrower oftentimes unaware how little of that $8000 went toward the principal on the house, but for servicing the loan, loan origination fees, mortgage insurance, title insurance, title registration fees, etc. In THE BORROWER'S mind, they "put down" $8000.
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| Oct 7 @ 5:34 PM |
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Heaveninawildflower
Posts: 15,333
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Um, not towards closing costs, he's entirely correct there.
In addition to the down payment, you'll also have to pay closing costs -- miscellaneous fees charged by those involved with the home sale (such as your lender for processing the loan, the title company for handling the paperwork, a surveyor, local government offices for recording the deed, etc.). The amount varies, but could be, say, $6000 on a $130,000 house. The range is all over the map -- from 1 to 8% of the price of the home, though more typically 2-3%. These costs are significant -- especially after you've already had to come up with a lot of cash for the down payment.
How to buy a house
No matter how the borrower looks at it, they are two separate costs...also editing to add that I saw Capo's response, which is the gist of it - down payment is applied to the quoted cost of the house, while closing costs are just that, additional costs.
[Edited on 10/7/2008 5:36 PM]
[Edited on 10/7/2008 5:37 PM]
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| Oct 7 @ 5:34 PM |
economic lies about the economy...
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capobeachguy
Posts: 3,658
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The term "down payment" is exactly what it sounds like. It is the amount of money used to pay down the sales price, regardless of the other loan parameters and fees. 100% of it goes against the principal. It's that straightforward.
As to answering the balance of the question, there are many variables in addition to the closing costs...such as the appreciation (I always expect real estate to increase by an average value of about 12%), tax advantages, interest rate, etc.
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| Oct 7 @ 5:35 PM |
economic lies about the economy... |
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KatiefromStafford
Posts: 2,266
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very true, Night.
(looks back at Capo in the tennis match.. )
So, who pays all those fees then?
I remember we got a lot of those when we 'bought' a house in Texas..
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| Oct 7 @ 5:37 PM |
economic lies about the economy...
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Gallows_Humor
Posts: 8,063
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just for capo.....really old school stuff.... prior to pre bubble.."creative financing "circa 1985....
A conventional mortgage is also defined in terms of its "loan to value" ratio or LTV. An 80 percent LTV is the standard for conventional loans,a percentage which means that if a house costs $100,000, the lender will provide financing worth $80,000 (80 percent of the purchase price) and the borrower will put up $20,000 (20 percent). Closing costs are EXTRA AND ADDITIONAL above the $20,000http://library.hsh.com/?row_id=136.
although... there were also FHA 3 percent down payment loans .. that allowed almost all closing costs to be financed... but the problem was that the loan caps were just too low for some areas...
edited for........
oh I get it.. we are back on semantics here... down payment vs total cash investment to purchase a home.... ....
you are a jerk capo... get a life 
[Edited on 10/7/2008 5:39 PM]
[Edited on 10/7/2008 5:40 PM]
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| Oct 7 @ 5:39 PM |
economic lies about the economy... |
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capobeachguy
Posts: 3,658
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Heaven understands. Perhaps you can learn from her.
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