Charge it. Charge it. Charge it. Oh, crap.

HousingPANIC Stupid Question of the Day

Ever make the mistake of thinking someone with a big house, nice cars, expensive clothes and a lavish lifestyle was rich (when indeed they were simply jacked up to their eyeballs in debt)?

More on homeowners versus homedebtors...

Agreeing to pay a lender interest for the next 30 years, or 10,950 days, in order to live in a home that is not yours does not make you a homeowner. It makes you a homedebtor.

Homeowners are not losing their homes. They weren't their homes in the first place.

Homeowners are not in troube.

Homeowners don't need to be bailed out.

Homeowners don't have toxic loans.

Homeowners were not victimized by predatory lenders.

Putting little or nothing down and signing up for a loan does not make you a homeowner. It did not give you special status versus renters. It did not elevate you to a new class or socioeconomic status. It did not mean you have arrived.

HOMEDEBTORSHIP IS NOT HOMEOWNERSHIP.

Now that the sheeple can't fund their lavish lifestyles with cash-out mortgage refi's anymore, what will they do?

1) Spend less

2) Try to earn more

3) Keep spending like there's no tomorrow until someone cuts them off, going deeper and deeper into debt to buy crap they don't need and can't afford

Spin, hamster, spin! Faster, faster, faster!

How many people do you know like this? "I'm in debt up to my eyeballs"

Debt-junkie Americans now can suck the funds out of their 401k's with the swipe of a card. Oh, man, how stupid can people get?

OK, that's it. I give up. We're f*cked. Get ready for BenefitsPANIC. How stupid can people be? When people don't have enough money for retirement in a few years and they look for government bailouts, I hope you remember stories like these.

Thanks EM for the link. You ruined my day.

Just Put It on My 401(k) Debit Card - Borrowing against your nest egg is becoming as easy as stopping at an ATM.

A growing number of companies now offer employees the option of being issued a debit card that taps a 401(k) loan. The card, called ReservePlus, allows workers to withdraw funds from their 401(k)s.

The immediate concern for consumers is that impulse spending desires could trump their long-term savings needs.

Critics contend use of the cards risks depleting already skimpy retirement savings. "Big picture: it just takes us out of the context of a 401(k) loan being a loan of last resort," says Jean Setzfand AARP's Director of Financial Security. "Seeing what we see, with retirement savings not quite where we want to see it, we're just afraid that this is going to deplete it further."

And then the debt addicts couldn't pay for their next fix

What the hell happened in America these past few years?

Was it HGTV and MTV Cribs?

Was it rap music switching from ghetto to bling bling materialism?

Was it the general decay of morals and personal responsibility?

Was it the ads?

Whatever it is, it's disgusting, it's unsustainable, and now the whole house of cards collapses. The real interesting thing will be finding out who in the end actually holds the bag (hint - it ain't the junkies)

Unpaid credit cards bedevil Americans

Americans are falling behind on their credit card payments at an alarming rate, sending delinquencies and defaults surging by double-digit percentages in the last year and prompting warnings of worse to come.

An Associated Press analysis of financial data from the country's largest card issuers also found that the greatest rise was among accounts more than 90 days in arrears.

Experts say these signs of the deterioration of finances of many households are partly a byproduct of the subprime mortgage crisis and could spell more trouble ahead for an already sputtering economy.

HousingPANIC Stupid Question of the Day

Without cheap, easy, abundant and fresh credit, what will become of the American consumer? What will become of the American economy (70% of which is consumer spending)? What will become of our self-image?

Because you know we don't earn enough to actually PAY for all of this stuff...

Debt-addicted Americans looking for a fix - "Stressed borrowers use plastic to delay default"

Debt = Slavery. And credit-addicted, live-beyond-their-means Americans are about to find out that no, money doesn't grow on trees and yes, Congress tightened bankruptcy laws at a very interesting time.

Oh, this will end so ugly. So, so ugly.

Rising mortgage payments and tighter lending standards for refinancing amid the subprime credit crisis have dried up once-easy access to home equity loans for many middle-income borrowers -- so desperate borrowers are using credit cards to cover basics while trying to keep up with home payments.

"When credit conditions dry up, marginal borrowers turn to plastic," said Merrill Lynch North American Economist David Rosenberg. "We're seeing signs of that already."

In an October 5 research note, Rosenberg called rising credit- card delinquency rates as the "next skeleton in the closet."

It is one scary skeleton -- and a specter of bankruptcy.

The problem with using credit cards -- with their high interest rates -- to stave off default brought on by "reset" adjustable mortgage interest is that it merely postpones an inevitable crisis, said Gregary Brown, social policy director at Metropolitan Family Services in Chicago.

"Our biggest concern right now is that there are lot of people who will face a choice between bankruptcy or foreclosure," he said. "Either way, it's going to suck."

Want a sense of how bad debt-saddled and spending-addicted Americans are doing? "Cash-strapped Americans raiding their 401(k)s"

Housing-addicted Americans thought the party would never end. They stopped saving, they spent like millionaires, they raided their homes for spending loot, and now they're starting to suck dry their 401ks.

THIS IS SICK!!!! NOTE TO AMERICANS - YOU DON'T NEED MORE CHEAP CRAP FROM CHINA!!! PUT DOWN THE DAMN VISA CARD AND LIVE WITHIN YOUR DAMN MEANS!!!

What's next? Peeling off drywall to heat the home? Putting your kids on eBay? Addicts I tell ya. Addicts.

Despite potential tax and investment problems, more investors have been borrowing from their 401(k) plans or taking hardship withdrawals in recent months, some retirement plan providers say.

Many in the field expect more borrowing in 2008, as consumers struggle with tighter credit and potentially higher mortgage payments.

Increased borrowing on 401(k)s could be because of the credit crunch and slumping housing prices. To be sure, the indications are preliminary; it's too early to say why it's happening, according to the Hartford Financial Services Group.

Bubble Sitters: How much longer do you plan on renting?

1) Should be a matter of months

2) This is gonna take awhile - likely a few years

3) No timeframe - will rent until the fundamentals make sense again

4) Don't plan on ever "owning" again

5) I'm not renting yet - still can't unload my debt-trap

One more life question for ya... If you lost your job today (like our REIC friends), would you be OK? Are you prepared?

Are you one of the millions of no-savings debt-monkeys running around America and Europe tonight, maxed out to the teeth, living beyond your means, and assuming the good times will last forever?

Or are you an HP'er?

Which do you think toxic mortgage homedebtors would choose to keep first - their MasterCard or their house? Welcome to crazy land folks

Those zero-down liar's loan failed housing gamblers sure are a funny bunch. Too bad for the bag-holders and too bad for anyone who thought 2005 home values were anywhere near reality.

Debt-Laden Homeowners Save the Credit Card Before the House
NEW YORK (AP) -- Conventional wisdom has it that people will do everything to keep their homes. Not any more.

The proliferation of no-money-down home loans over the past few years, coupled with the current housing downturn, is giving rise to a new mentality: People will risk losing their homes while doing everything to keep their credit cards.

"This is the biggest surprise we're seeing," said Elizabeth Schomburg, senior vice president of the Family Credit Counseling Service in Chicago. "People are actually coming to us with situations where they are current on their credit cards but are in foreclosure."

Here's some great advice for people worldwide consumed with consumerism - DON'T BUY STUFF YOU CAN'T AFFORD!!!

Classic!

Especially relevant as housing melts down, and people making $50,000 a year complain to their Senators about not being able to make the payments on their $1 million homes anymore.

Waaaaaaaaaa!!!!

Word to the wise - live within your means. Pay cash. Read the fine print. AND DON'T BUY STUFF YOU CAN'T AFFORD!!

HousingPANIC Stupid Question of the Day: Debt

HP'ers - how much debt do you have? (Post as anon)

1) Mortgage

2) Cars

3) Credit cards

4) Student loans

5) Other debt


I think if we asked this question to John Q. Public, versus HP'ers, we'd get vastly different answers. I expect "$0" to be quite common here.

Neither a borrower nor a lender be... Have truer words ever been spoken? Just look around you today - both sides of this equation suck.

Neither a borrower nor a lender be;
For loan oft loses both itself and friend,
And borrowing dulls the edge of
husbandry.

- Polonius, from Hamlet by William Shakespeare

Ladies and Gentlemen I've found our new Casey Serin. A 24-year old kid with $300,000 in unsecured debt: Introducing "Debt Kid"

Hundreds of years from now when they study this brief period of debt stupidity (2001 - 2007), they might find Debt Kid (along with HousingPANIC of course).

Enjoy.

Or on second thought, be afraid. Be very afraid.

DebtKid.com
my journey to repay over 300K in unsecured debt…I am 24.

I got myself into 300K+ of unsecured debt. I recently avoided foreclosure by short selling my home. I've been trying to build my business income up. This while trying to deal with being over 300K in debt and now living in my office. Let's just say my life ain't boring.

A few things I need to decide this week:

#1. Should I consolidate my office into a “home office”? I’ve been in this building for over 2 years now. My office space is a good deal, but with only 2 full time employees (myself included) and one part-timer, shouldn’t I work from home? I’m looking at a place tomorrow that would be larger than my current office (yet also provide a “real” place to live. ahh….a real mattress!).

#2. Can I file Chapter 7 Bankruptcy? We are getting to crunch time now on the BK filing. If I’m going to do it (I have to at this point, it’s the only thing that makes sense all around) I need to get it all figured out this week. I made more progress on the paperwork today, but it’s difficult finding time when my employees are not around (and I have a friend visiting from out of town! yikes…)

#3. Can I win the contest at DCC? (go here to vote for me, please leave a comment too!) If I can win that contest I may just have enough money to get a place I’m looking at that could hold both myself and my business! (for only $200 more. IE, with no business lease @ $800/month this place would only cost me 1K/month, and allow a place for my business and personal life!). Obviously I’m hoping I can win this contest!

#4. Will I ever be back to my “old self”? I don’t think so. I don’t think I want to be. As I slowly shed every piece of my former life (big house, lots of crap, fake relationships, fancy office?), I’m feeling more and more genuine and real and honest…and it’s wonderful.

#5. Will I ever make it out of this hole? I don’t know. I’m still so right on the edge right now….

What do you think?

Get ready shoppers for the Great Homedebtor Firesale of 2007 - 20??

It'll all be on sale. All of it.

Got cash?

Maybe it really is different this time: Wal-Mart posts worst sales ever

Has the debt-up-to-their-eyeballs-no-savings-housing-ATM-is-closed US consumer (finally) rolled over?

Wal-Mart, the world's largest retailer, yesterday posted its worst monthly sales figures since its records began in 1980.

The company said same store sales fell 3.5% in April on the same month a year ago. Same store sales measure the performance of stores that have been open for at least 12 months.

But Wal-Mart was not the only US retailer turning in a poor performance in April, triggering fears that the US housing slump might be spilling over into consumer spending and that the economy might be taking a turn for the worse.