Rune (09-21-2018)
Members banned from this thread: evince, CFM and reagansghost |
Danielle DiMartino had a great comment on this:
It is SO DIFFICULT to read these stories. The #Fed is responsible for plight of lower income earners who've suffered as Greenspan, Bernanke & Yellen chased delusion of the "wealth effect."
The article lays out the results.
Cash-strapped Americans are leveraging their homes to pay the bills
As U.S. household debt rises and wages stagnate, millions of Americans are tapping into home equity to keep up with day-to-day expenses.
Twenty-four million homeowners believe borrowing against home equity is an acceptable way to cover regular bills, according to a Bankrate.com report released on Wednesday. Cash-strapped millennials, low earners and the less educated were most likely to think home equity offered an appropriate solution to ordinary bills.
"Regular household bills should be funded by a regular household income, not home equity," said Greg McBride, chief financial analyst at Bankrate.com. "Wage growth has been elusive, but rising household expenses have not. And now home equity is being seen as a lifeline for those who are strapped for money with little wiggle room."
The study, conducted by research firm GfK, surveyed a national sample of 1,000 American adults-719 of whom were homeowners-from Sept. 7-9.
Almost 1 in 3 homeowners who earn less than $30,000 per year said it's OK to tap into home equity to cover their everyday bills, more than triple those who make $75,000 or more. Twenty one percent of those with no more than a high school diploma agreed, nearly doubling those who have a college degree. And 22 percent of millennials also felt home equity was an appropriate resource for paying bills, compared with only 12 percent of older Americans.
"These people are living paycheck to paycheck with little or no emergency savings-and they're scraping up money any way that they can," said John Hope Bryant, chief executive officer and founder of Promise Homes Co., a property asset manager that offers affordable housing and financial support services to families.
Almost 1 in 4 Americans have no such savings, according to a June Bankrate.com study. But even cash-strapped homeowners are more fortunate than many, Bryant said, since U.S. homeownership has fallen to the lowest rate in more than 50 years.
About 3 in 4 homeowners said home improvements or repairs are an appropriate reason to borrow from home equity. Other reasons included debt consolidation and education expenses, the study found.
U.S. household debt has continued to rise through the second quarter, propelled by an increase in mortgage borrowing, according to a Federal Reserve Bank of New York report released in August. Total household debt rose 3.5 percent from a year earlier in the April-to-June period, to a record $13.3 trillion, while mortgage debt also rose 3.5 percent, to a whopping $9 trillion.
The cost of home equity borrowing is on the upswing as well. Interest rates on home equity lines of credit, otherwise known as HELOCs, are at their highest since the 2008 financial crisis, data from Bankrate.com show. This increase is in line with U.S. benchmark interest-rate hikes.
"The high interest rate on home equity debt is going to exasperate the situation," Bryant warned. "And it could ultimately dampen property sales."
http://www.chicagotribune.com/busine...919-story.html
Rune (09-21-2018)
"I mean, you got the first mainstream African-American who is articulate and bright and clean and a nice-looking guy. I mean, that's a storybook, man."
— Joe Biden on Obama.
Socialism is just the modern word for monarchy.
D.C. has become a Guild System with an hierarchy and line of accession much like the Royal Court or priestly classes.
Private citizens are perfectly able of doing a better job without "apprenticing".
Truth Detector (09-20-2018)
You're making the assumption that because they make less than $30K today that they've always made less than $30K. And these folks could have bought their homes 10, 20 or 30 years ago when homes were much cheaper.
We saw what happened in the financial crisis when people used their homes as ATM's. The Fed has fvcked seniors and low income folks with their policies. This is the result.
Guno צְבִי (09-20-2018), Rune (09-21-2018)
How are Investors doing? Let's face it, no one gives a shit about Losers, how are the Investors doing?
If we bring in more Mexican Labor to drive down wages, can we hard fuck these people?
I've always heard selling the same house over, and over and over and over again is a great way to make money.
Rune (09-21-2018)
we are finally getting wage growth above inflation, and it's likely to improve , Household expenses are bitch to cover ."Wage growth has been elusive, but rising household expenses have not. And now home equity is being seen as a lifeline for those who are strapped for money with little wiggle room."
This sounds familiar.
I think it's fine to do it if you are retired and need to. But it's as a practical matter like bleeding the IRA
for those who don't have a retirement savings.
evince (09-20-2018)
I was young, well educated (professsional degree), owed tons in student loans and didn't have two nickels to rub together. BUT there was no keeping up with the Joneses in my mind.
Advice: stay broke and live like a roach until all loans are paid then live debt free.
Worked for me. I didn't buy my first house until I was 40 and now have house and two condos in Hawaii paid for in full.
Callinectes (09-20-2018), cancel2 2022 (09-20-2018)
evince (09-20-2018)
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