For those of you who have delicate ears and don't wanna read me cursing, step away now, cause I'ma 'bout to let 'er rip. I was listening to the radio today and I heard an ad for the Lars Larson show, apparently a conservative themed radio program, and he said essentially those who got a mortgage that they couldn't afford and got caught up in the mortgage mess are STUPID. Ok, M**A F***A, say that sh*t to my face!! I got caught! I am a university professor. I have a Bachelors and a Masters degree. More broadly, just because you got caught doesn't mean that you were stupid. A little of my story:
I saved for YEARS to buy my first house. My mom said to me when I got married, "you can get married in a really nice hall for a lot of money, or you can have your reception in 19th Street Baptist Church for $500....I will give you the difference to put towards your first house." My reception had no dancing because we ate our dinner and had the creme de la creme of Philly Jazz Musicians in the reception hall of a Baptist (read: no dancing allowed) Church. And even then I still had to save for YEARS after that to buy my first house. Once I had the down payment, because I was a musician, and thereby self employed, I was offered no option but a high mortgage rate. I was told by my mortgage broker, who by the way was the nephew of my mother's college classmate, that if I paid my mortgage on time for 12 months, I could refinance for a reasonable rate of 7%. Unfortunately for me, I decided to take out a home equity loan to upgrade the property at the same time because, in order to own that particular house, I had to become a landlord. The house was old and needed fixing up. So I got a very low rate, and paid regularly, but a couple of years in, my payment changed DRAMATICALLY. I called the company and said,"What de hell!!??!!" And they said,"you signed an ARM, an adjustable rate mortgage", I replied, "No, I DIDN'T. I wouldn't do that because that would be a financially stupid decision for me" Them: "We have your signature if you'd like to see it" I had been caught in a trap! My mortgage broker - - remember: he was the nephew of a close friend of my mother's, someone you might think had my best interests at heart - - had screwed me over. I shook my head sadly…I thought somehow I must have missed something.
Later on, when I bought my house in MD, I talked to the title agent. That person may have been blowing smoke up my ass, but she said, "No, Alison…you didn't miss anything. I've talked to you for a while, and they just didn't tell you what you were signing. I've seen it happen many times."
How many houses do people buy in their lifetime?! FOR REAL?! One?! TWO?! In NYC, the mortgage contract is 1.5 INCHES thick full of legal size papers in REALLY small print. It is EXTREMELY PLAUSIBLE that a vast number of people didn't completely understand everything in such a complicated document. Also, when someone dangles your dreams in front of you, no matter how thoughtful you are, if it's something where you don't have a lot of experience, you may make a mistake. That doesn't in any shape, form or fashion equate with stupidity. And FYI Mr. Larson, and any one else who talks about normal, rational people who may have made a mistake: Bankers, mortgage brokers, real estate agents and title agents all made a whole lot of money every time someone got a mortgage, home equity loan, or any other real estate based financial product. It was in their financial interest to get as many people to buy or sell their homes as they could. Everyone, soup to nuts, was making a sh*tload of money. So goody for you, Mr. Larson, whoever the hell you are, that you didn't get caught in the housing CRISIS. From the rest of us stupid, fallible, people we'd like to say, "Kiss my a**!! And make sure you don't miss a spot and be sure to feel and smell the breeze while you're down there...."