///The ARM?

Hey, remember those ARMs from 5 or 6 years ago that did their part to melt down the economy?

swing and a miss...how 'bout this; "Hey, remember those people who signed up for ARMs 5 or 6 years ago, didn't understand what they were signing up for, and did their part to melt down the economy by bailing on their mortgage payment commitment, expecting the federal gov.to bail them out, destroyed their properties before leaving them, or blamed lenders for preying on their stupidity, rather than take some responsibility themselves?"

AuntofDogface: WaltzingMathilda: ARMs, in and of themselves, are not bad things. giving them to people who can't afford them is.

If you know you're only going to own the house for the short term, it can be a "win-win".

Sure it can if the housing market doesn't collapse and you're able to unload it in time with out taking a loss...

Gwendolyn: If you know you'll be in a position to get a much better fixed rate in five years I think they are a good idea.

That naive view is exactly what got millions of people in trouble. You should only get an ARM if you can afford the payment at the capped rate WHEN you get the ARM. Everyone was lulled into thinking that low interest rate credit was universally available and would be forever. In five years interest rates might be in double digits, or credit may be very hard to come by, there's no way to know.

Englebert Slaptyback: NightOwl2255

and a large penis or breast (which ever applies).


So... just the one, then?


*goes shopping on Amazon*

Well played you magnificent bastard. I knew I had you favorited for a reason.

the_sidewinder: /ARM?

Thank you so, so much.
You better be handing out newsletters!

/ARM: What a netbook is SUPPOSED to be. Not these $399 Dell BullS&*( things that run windows like a snail runs a marathon.

No thanks.

/Have a fixed rate at 4.75%.

NightOwl2255: Flab: Is this where we brag about our fixed-rate mortgages, and making extra payments on the principal as well to shorten the mortgage duration?

Yes, this is the place. Also, no credit card debt, a gigantic 401K, a Roth IRA that dwarfs the GDP of most nations and a large penis or breast (which ever applies).

Why not have both?

BabyShaker: I'm sorry, can someone explain just why I shouldn't be proud of being fiscally responsible??

No reason other than it makes you sound douchy. If you're cool with that and the derision that comes with it, then fire away.

BTW, and ARM is not the same animal as a balloon mortgage. With the rates staying in the sub 5% range, no one with an ARM is having problems. It's the people who got a 2.5% rate that jumps to a 8% rate that are in trouble.

I knew ARM controlling 95% of the mobile cpu market would spell doom for us all.

But did they heed my warnings? No.

Thunderpipes: NightOwl2255: Flab: Is this where we brag about our fixed-rate mortgages, and making extra payments on the principal as well to shorten the mortgage duration?

Yes, this is the place. Also, no credit card debt, a gigantic 401K, a Roth IRA that dwarfs the GDP of most nations and a large penis or breast (which ever applies).

Why not have both?

I hear there is some pron out there like that but I wouldn't know.

/Deletes temp files...

What about Wild ARMs?

JohnBigBootay: I have a 30 year fixed at 4.75 and that's the right mortgage product for me...HOWEVER it really pisses me off to see IDIOTS - and there's no other word for it really, these people are IDIOTS - who vilify ARM's like they're the ebola virus. They're a mortgage product people - that's it. One of the many choices available to us and extremely appropriate in particular situations. There are many examples when they are absolutely the perfect mortgage product for a given situation. Were they overused? Definitely. Were they purchased by people who had no reason using on? Undoubtedly. Did unscrupulous bankers push people into ARM's when it was the wrong product for the client? Without question. That's on them. There's nothing wrong with ARM's under the right circumstances and they are often the best choice. If you don't understand which mortgage product would be the best one for your own situation and why you should wait to buy a house until you do.

Are you blind? 5 year Option ARMS and Neg AM loans that were written being between 04 and 07 are now just starting to come due..and it will make the sub prime collapse look small. $750B in these loans are coming due over the next 3 years. These are the white collar guys who bit off more than they can chew. Now they are not only below water, but many of them are UNEMPLOYED. Wait until the next wave of foreclosures hit... TIMBER!!!

... but that's okay, you go on believing that everything's okay and that people who think ARMs don't cause housing bubbles are ill informed.

@rlbgator - That's an awesome book.

The Corporation: I knew ARM controlling 95% of the mobile cpu market would spell doom for us all.

But did they heed my warnings? No.

Who's the ARM of which you speak? Would it be a corporation or, maybe, The Corporation?

Englebert Slaptyback: NightOwl2255

and a large penis or breast (which ever applies).


So... just the one, then?


*goes shopping on Amazon*

User Gorgor has been banned from responding to this post

grizzlyjohnson:
BabyShaker: I'm sorry, can someone explain just why I shouldn't be proud of being fiscally responsible??

No reason other than it makes you sound douchy. If you're cool with that and the derision that comes with it, then fire away.


This. Really it is douchy to brag about things. It be like me mocking BabyShaker for not having the fiscal skills to buy their houses in cash like some of us can. No matter how great you view yourselves, you'll going to be looked as irresponsible and no good by someone else or just showing off.

4.3BN in profits, so I am getting a kick out of these new sucker mortgages.

I have a 5/1 ARM in its 7th year.

It is about to readjust in two weeks from 5% to 3.2%.

grizzlyjohnson: Gwendolyn: If you know you'll be in a position to get a much better fixed rate in five years I think they are a good idea.

That naive view is exactly what got millions of people in trouble. You should only get an ARM if you can afford the payment at the capped rate WHEN you get the ARM. Everyone was lulled into thinking that low interest rate credit was universally available and would be forever. In five years interest rates might be in double digits, or credit may be very hard to come by, there's no way to know.

Hell, even a basic understanding of the costs of selling a home wouldn't hurt if you approach house buying as three year investment.

I just relocated and the people we bought the house from lost their shorts in large part because they didn't consider the costs of selling a house, even though they knew they would only be there for probably 2 years.

On a $300k house, that's about $18k in realtor fees alone, much less all the other random costs involved. They also didn't help matters in that they did absolutely no improvements or maintenance on the house even though it was already starting to need it. All this in an area not near as 'hot' as the ones that were in the news two years ago.

Cool! Does this mean my home value will skyrocket soon?

dead_dangler: Gwendolyn: If you know you'll be in a position to get a much better fixed rate in five years I think they are a good idea.

How exactly does one "know" what things will be like 5 years from now?

/The Stupid. It burns.

Are you a Global Warming Economic Recovery Denier?

But I need an ARM to give me a DUTCH RUDDER.

Hey if banks want to do these risky ARMs, knock yourself out.

Right after you sign this agreement you won't take a dime of taxpayer money should something go wrong with your cunning plan.

To qualify, home buyers must have credit scores of at least 720.

Dammit! I want another bubble.

People that have score of 720 or higher might actually use these in the right way.

/definite maybe.

ClarkstonCracker: there is nothing wrong with arm's. It's the liberal's in congress who believe everybody should be equal, therefor forcing banks to loan to people who suck at life.

This.

There is a little problem in this country of people taking PERSONAL responsibility for their actions.

I know someone who lost their home because of an ARM reset. When his mortgage payment went up, his response was to just stop paying his mortgage and start playing stupid about how things work.

It's a tough pill to swallow for those of us who make personal responsibility a priority in our lives.

tjfly: Are you blind? 5 year Option ARMS and Neg AM loans that were written being between 04 and 07 are now just starting to come due..and it will make the sub prime collapse look small. $750B in these loans are coming due over the next 3 years. These are the white collar guys who bit off more than they can chew. Now they are not only below water, but many of them are UNEMPLOYED. Wait until the next wave of foreclosures hit... TIMBER!!!

... but that's okay, you go on believing that everything's okay and that people who think ARMs don't cause housing bubbles are ill informed.

What do you mean 'come due'? Do you mean they're going to revert to adjustables after the fixed period is over? Duh - that's how they work. That said, rates are still incredibly low right now. There's tons of consumers who are actually seeing their rates GO DOWN when the fixed period is over. Either way, I don't get your point and you completely missed mine - which was simply that ARM's are fine products for people in particular situations. Does that mean there won't be people who get in trouble with them and have a lot of pain ahead? No - of course not. Lots of people bought the wrong product. Again, duh. There are tons of reasons to buy an ARM. Let's say you're moving to an area, want to buy a house but you know you're going to be moving in five years? Well, then an ARM is a perfectly reasonable choice. Or let's say you want a starter home now but you have have a large sum of money coming at some specific point in the future and you know you'll be trading up. Why pay 30 year rates on a 7 year loan? The danger in ARM's - which you completely ignored - frankly I think that's because you don't actually know how they work - is when you get into a property you intend to stay in and can only afford it because of the lower ARM rate (say on a 5/1) and the five years pass - then when we're in a higher rate environment (which we are not in now) your payments could go up quite a bit when the adjustable hits. Of course that's a danger. And why that person shouldn't have been in an ARM in the first place. Once again, duh. That doesn't mean the mortgage product is evil, just that it was used improperly. It's a tool - it has a proper use and it can be used improperly as well.

Sky Masterson: It is about to readjust in two weeks from 5% to 3.2%.

according to tjfly you're about to get wiped out from the coming superstorm of having to endure lower mortgage payments. That said, you're lucky rates are what they are today. If you have a job and decent credit it's probably not a horrible idea to look into a long term solution if you plan on being in the house a long time. Rates will definitely be going up - the question is when, and by how much. You don't want to get trapped in a situation where rates are rising fast but you can't refi.

limeyfellow: grizzlyjohnson:
BabyShaker: I'm sorry, can someone explain just why I shouldn't be proud of being fiscally responsible??

No reason other than it makes you sound douchy. If you're cool with that and the derision that comes with it, then fire away.


This. Really it is douchy to brag about things. It be like me mocking BabyShaker for not having the fiscal skills to buy their houses in cash like some of us can. No matter how great you view yourselves, you'll going to be looked as irresponsible and no good by someone else or just showing off.

That and you're just looking like you're pretending you never made any mistakes or went through any learning process. Here in Mormonland I know lots of people who followed the established social template, mission at 19, get married when you come back, get a degree, get a job, buy a house, have as many kids as you can, don't buy things on credit. I suppose there are folks out there that never got themselves into financial trouble, or any kind of trouble, but I'd never trade my life experiences for perfect fiscal responsibility from the get go.

Sure I'm in pretty good shape now that I'm older, but only as a result of plenty of hard knocks from school of same. But then it would be just as douchy for someone like me to brag about picking people's teeth out of my knuckles or having been shot at or seeing the inside of a mexican jail.

Am I the only one that finds stories about successfully conforming to society's expectations sad and boring? Or the people that are proud of them lame and pathetic?

JohnBigBootay: Sky Masterson: It is about to readjust in two weeks from 5% to 3.2%.

according to tjfly you're about to get wiped out from the coming superstorm of having to endure lower mortgage payments. That said, you're lucky rates are what they are today. If you have a job and decent credit it's probably not a horrible idea to look into a long term solution if you plan on being in the house a long time. Rates will definitely be going up - the question is when, and by how much. You don't want to get trapped in a situation where rates are rising fast but you can't refi.

Do they still do those convertable ARMS where you can lock in a fixed interest rate?

Gwendolyn: If you know you'll be in a position to get a much better fixed rate in five years I think they are a good idea.

Well, your crystal ball had better be really, really good to determine where the rates will be and what your situation is 5 years from now...

NightOwl2255: Flab: Is this where we brag about our fixed-rate mortgages, and making extra payments on the principal as well to shorten the mortgage duration?

Yes, this is the place. Also, no credit card debt, a gigantic 401K, a Roth IRA that dwarfs the GDP of most nations and a large penis or breast (which ever applies).


I've got a large breast...but only the one. I must be a freak.

But on a side note, we should all be HAPPY that the guv-mint is giving us the RIGHT to bear A.R.M.s. They're just someone else's A.R.M.s that we have to pay for because the numbnuts got way in over thier head.

I think I'll keep my pair of grizzly bear arms on my wall, thank you very much.

Spindle: Is this also a good place for me to mention that my 401k is only about 3 grand away from being equivalent to stuffing my money in a mattress?

That's way better than mine! At least if I had stuffed it in my mattress, the value wouldn't go DOWN :(

NightOwl2255:and a large penis or breast (which ever applies).

Hey! I Thailand there are some people that have both!

//Well, that happens in the US, UK and other places that have fat people also, but those guys aren't very sexy

Doh! -- In Thailand

I laugh at suckers who pay mortgages. Im doing just fine in my moms basement.

BabyShaker: sigdiamond2000:So true. The avalanche of "look how responsible I am with my money" posts are sure to follow.

I'm sorry, can someone explain just why I shouldn't be proud of being fiscally responsible??

Well, totally incompetent, fiscally irresponsible people don't have credit cards either....

Iwouldhitit: NightOwl2255: Flab: Is this where we brag about our fixed-rate mortgages, and making extra payments on the principal as well to shorten the mortgage duration?

Yes, this is the place. Also, no credit card debt, a gigantic 401K, a Roth IRA that dwarfs the GDP of most nations and a large penis or breast (which ever applies).

I'd also like to point out that I don't own a television, I built my own computer for $75 in parts and whatever woman you find most desirable has unacceptably sharp knees.

You forgot to mention how you paid for your car in cash, have at least a year's salary in savings for potential unemployment...and how your children are so perfectly behaved, random strangers compliment you on your superior parenting skills.

/NTTAWWT

Wait, are we talking about regular ARM loans, or Ballonn ARM loans?

The former is simply a 20- or 30-year variable-rate loan that fluxuates from year to year, based in part on the Fed interest rate, and on market trends. It can be lower than a fixed-rate loan for several years, then be slightly higher few years after. These types of laons are best used when buying a home during a peak year, because the rate and monthly payments are more likely to go down as time passes. You can then refinance to a fixed-rate loan a few years later, once interest rates have dropped to level more acceptable for fixed-rate loans.

The latter is a loan that offers a deep-discount teaser rate, that suddenly balloons to a triple (or even quadruple) the teaser rate after a set amount of time. These are the high-risk loans that brought this country to the brink of disaster.

Bukharin: My arm is about to adjust to a lower rate. Heh.

Ditto. Mine dropped a point. The most it can change next year is to go back to where it was (which is still pretty low).

UHC2005

Well played you magnificent bastard. I knew I had you favorited for a reason.


I'm on someone's favorites list?? How about that! (seriously)

*does Numfar's dance of joy*

Am I missing something, or is ARM just another name for a variable-rate mortgage? Is there a difference of some kind?

tjfly: Are you blind? 5 year Option ARMS and Neg AM loans that were written being between 04 and 07 are now just starting to come due..

Boy, Am I ever glad that I refinanced the ARM I got when I bought my house in '04 in '06 (or was it '05) to a Fixed Rate Mortgage, just before the Mortgage market went FUBAR! I knew I had to refinance it to a Fixed, BEFORE it did the ARM thing and started adjusting, when I got it!

However, if I had waited another year to refi (it wasn't due to start adjusting for anther 1.5 years when I refied), I would of been screwed!

Fjornir: ARMs aren't a bad thing any more than a hammer is a bad thing

If you're going to use that analogy, I would liken ARMS to a bulldozer rather than a hammer in that pretty much anyone can use and should have access to buying hammer while a bulldozer is a more complex instrument that a vast majority of the population really doesn't need and, furthermore, can be more dangerous if used improperly or in the hands of those who shouldn't be using it.

A pay-option ARM is a supped-up bulldozer with spinners driving the wrong way on a freeway at 70 MPH. Are there some people that could potentially handle this? Sure, but the vast majority can not and should not be able to try to do so since their actions can affect the vast majority of us "sanctimonious" fiscally responsible people driving the correct direction on the freeway in a sedan.

Im renting, so im really getting a kick out of some of these replies.

Perducci: Oh, and it also includes things like ensuring you actually have marketable skills in case you do lose your job and have to find another one.

That's not sufficient!

There are several (ex)colleagues of mine that were "laid-off" when my company decided to "off-shore" a lot of IT positions last year. They are all highly skilled IT professionals with BS (and some with MS) degrees and years of experience.

Most of them are still looking for jobs :(

grizzlyjohnson: douch

Oh, do you also have a pic of your "awesome looking", home schooled wife?

You'd better lock in a fixed rate soon because when the gov't is on the hook for all this money being printed, the fed will be forced to raise interest rates. They should've been 10-13% the last decade, not artificially lowered to almost 0.