Maybe a better solution for home-loans, credit cards, etc, would be some sort of intelligence test that the lender of credit needs to give to the perspective lendee?
Discrimination?
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Maybe a better solution for home-loans, credit cards, etc, would be some sort of intelligence test that the lender of credit needs to give to the perspective lendee?
Hmmm... an interesting observation. Ok.... let me conceed the arguement to you then. Maybe you are right, maybe there is a much larger percentage of people out there than I thought possible, that are just sort of barely able to mentally get on with their lives. People that have reached adulthood, but are fairly low functioning, and have no family or friends to help them.
Maybe a better solution for home-loans, credit cards, etc, would be some sort of intelligence test that the lender of credit needs to give to the perspective lendee? Something tangible that would prove a working knowledge of interest rates, balloon payments, PMI, etc, depending on what sort of credit the person was going for? That might solve a few problems. The lendee gets their loan or credit upon passing a certain "financial literacy" test (much like a drivers licence exam), and the lender is now protected against later allegations of "predatory lending" and the like. Seems a fair and equitable trade to me. The banks and credit card companies of the world now have to prove that the people they do business with, are mentally up to the task of performing such transactions. And if not... no loan, credit card, etc. No way to financially hurt themselves any more. What do you think?
I don't think you can legally live in a fire damaged studio apartment after it's been a methlab.
My starter home was wasn't even legally inhabitable until I put 10K into repairs and it still cost 145K for a 2 bedroom 1 bath.
Depends on your "time reference". Here's our "history" as we moved "up the scale":
1971 - $4.5k (mobile home-e.g. "trailer" - 3 BR/1 bath)
1975 - $21k (in-town twin - 3 story - 5 BR/1 bath)
1979 - $60k (detached ranch - 2 BR/1 bath)
1994 - $222k (traditional colonial - 4 BR/2.5 bath)
20xx? - gravesite (priceless!!! )
- Ron
Depends on your "time reference". Here's our "history" as we moved "up the scale":
1971 - $4.5k (mobile home-e.g. "trailer" - 3 BR/1 bath)
1975 - $21k (in-town twin - 3 story - 5 BR/1 bath)
1979 - $60k (detached ranch - 2 BR/1 bath)
1994 - $222k (traditional colonial - 4 BR/2.5 bath)
20xx? - gravesite (priceless!!! )
- Ron
Morbid.
Don't think that my generation in certain areas of the country will be able to get any think like this for this price. Traditional colonial 4/2.5? Try 500k... It may be just a different time in inflation, but this further proves the theory that over time houses stay in line with wages (about 3x national average), so any major deviation will eventually lead to a reversion to the mean.
When I was looking at buying a house a couple years ago even mobile homes started at 100K.
The comments about IQ got me to thinking. Not just IQ, but almost everything can be measured and distributed on a bell curve. In regards to IQ, that means that each time you go to the grocery store and see someone that looks severly handicapped, there is a genius somewhere as that person's opposite on the bell curve.
So too, if we distribute people according to their financial ability on a bell curve. For each person able to manage well, there is another that is going down the tubes. As we look at those who fall farther from the mean with enhanced financial ability, there are those who have already crashed and burned.
Those in the middle are just getting by. That the tests keep getting harder, by that I mean the inducements to spend are slicker, flashier and more appealing while the risks are glossed over, does not make life easier, especially for those exhibiting less ability.
The financial literacy test is already administered. In fact, it does a pretty good job at predicting what borrowers are going to renege on loan obligations, and which borrowers are trustworthy. The lowest scores are not extended credit by most reputable lenders, and if they want credit, they will need to go to loan sharks. To make it easier on lenders, this financial test is developed by one company, a company that focuses on predictive modeling. Do you know where to find the results to your financial literacy test? Check your FICO score.Hmmm... an interesting observation. Ok.... let me conceed the arguement to you then. Maybe you are right, maybe there is a much larger percentage of people out there than I thought possible, that are just sort of barely able to mentally get on with their lives. People that have reached adulthood, but are fairly low functioning, and have no family or friends to help them.
Maybe a better solution for home-loans, credit cards, etc, would be some sort of intelligence test that the lender of credit needs to give to the perspective lendee? Something tangible that would prove a working knowledge of interest rates, balloon payments, PMI, etc, depending on what sort of credit the person was going for? That might solve a few problems. The lendee gets their loan or credit upon passing a certain "financial literacy" test (much like a drivers licence exam), and the lender is now protected against later allegations of "predatory lending" and the like. Seems a fair and equitable trade to me. The banks and credit card companies of the world now have to prove that the people they do business with, are mentally up to the task of performing such transactions. And if not... no loan, credit card, etc. No way to financially hurt themselves any more. What do you think?
Or, would we rather that person get money from the loan shark thug down the street?
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Or the less-regulated industry which offers far better rates and safety than the loan shark.
...
You seem to want very badly to create a utopian-like place where no one is even allowed the possibility of making a bad deal.
you and I are going to help bail her out whether we like it or not.
Even Forrest Gump had pretty good discipline.
That's because his "momma always told" him . . . .
Canada doesnt have the subsidy because homes in canada cost $4 and are frequently eaten by beavers.
Canada doesnt have the subsidy because homes in canada cost $4 and are frequently eaten by beavers.
Why is loan-sharking illegal? How is the VW lady better off with Wells Fargo than with Vinnie..
... undoubtedly frequently eaten by nutria, instead of beavers (or bunnies with pancakes and bacon).
Maybe because they think it would be profitable under certain conditions. I see no reason to impose caps/floors on downpayments. It's their money. I'm not worried about how they make their money; that's for the shareholders to worry about.Hmmm.. in most of Europe mortgage interest is not deductible, I don't believe.. I should check. The way they establish people being "rooted" is that -quaintly- banks require 20%-50% down before they will give you a mortgage.
Encouraging SO-CALLED home-ownership with ZERO PERCENT DOWN and other down-payment mitigation schemes (some borderline fraudulent) is not encouraging rootedness or financial stability one whit. Doesn't matter whether the house or whatever other crap you "buy" with 0% down costs $80k or $800k. There certainly could and should be caps (minimum %) on down payments.
In addition, maybe you shouldn't be able to roll all the expenses (moving expenses and so forth) into the loan, nor should you get "cash back". The bank is not getting collateral out of your movers or your new furniture.. so why should they loan on that?
I consider physical harm a worse threat than bankruptcy. But that's just me. So you would be MORE scared if Vinnie said, "Now that I've broken your legs, and you're still not paying, I'm going to...Vinnie will only break her legs if she doesn't pay. Wells Fargo will ruin her life.