Sunday, March 28, 2010

California Homedebtors Punished for Their Arrogance and Financial Ineptitude

Look, it's not a state or federal crime to be incredibly arrogant and financially inept, but you've got to admit it sure can cost a pretty penny.

How can so many people be up to their eyeballs in financial distress?

One would have to hit the rewind button back to 2004 and 2005 with our favorite Realtor sales schtick:

1. "15% (appreciation) is in the bag!"
2. "Get in now while you still can!"
3. "They aren't making any more land!"
4. "Buy now or be priced out forever!"
5. "It's a great time to buy a home!"
6. "Interest rates have never been this low!"

Oh man. I get all woozy when I think about these jewels of Realtor wisdom.

I really wish somebody would force every single Realtor in Orange County to send out a 360 degree survey to their past clients between 2005 and 2008. I think that would make very, very interesting reading. Alas, I cannot do this, as I'm not a Realtor.
And Realtors don't have the guts nor the integrity to do this. Oh, the rage that would pour off those survey pages!

I don't blame them. It would be too disheartening to realize just how many lives can be derailed financially as a result of one's own greed - that drive to see the transaction exchange take place, regardless of the foreboding consequences.

Many of the individuals who fell for lines 1 through 6 above have or soon will foreclosure on their expensive southern California properties. They will have to pay income taxes on the amount of debt forgiven by the financial institution or bank.
Lost home. Lost credit score. Massive income tax liability.

There are those who believe these individuals deserve financial aid from state and federal government. I cannot count myself among them. You signed the dotted line. You made your bed. Many of these people scoffed at renters and savers, and those who chose not to leverage themselves into oblivion. I can only salute them for their arrogance and naivete.

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