CNN/Money: "Careers Vanish After Subprime Freefall"
I'd say I have no words ... but we all know that would be a lie. So here goes.
"We're still both in shock that it could go from something so good to so bad so quick," said Kent, 59. "New Century in 60 days went from top of the heap to out of business."
Yeah? Well, you should've watched The Smartest Guys in the Room. That whole Enron thing? It's all about smart people who got greedy. Then they figured they could never fail. And then they got stupid.
You could've learned something.
The two didn't say exactly how much money they made at their last jobs but Kent admitted they each had six-figure incomes.
Today, they're trying to get by on his unemployment benefits of about $450 a week, which covers only about an eighth of the basic payments they owe every month.
Today, they're trying to get by on his unemployment benefits of about $450 a week, which covers only about an eighth of the basic payments they owe every month.
Darn those payments, anyway. You mean they don't stop when the income does?
Their home equity line, mortgage, health and life insurance premiums alone cost about $10,000 a month. Still, they are trying to hang onto what they call their dream home with a view of the Pacific Ocean where they live with Mysti's 11-year old son.
Income of $1,800. Expenses of $10k plus.
That, friends, is some nasty math. So what's their roadmap from here?
"We've used up most of our reserves, cashed in her 401K," said Kent. "We're going Mach 1 into a wall. When we run into it, then we've got to decide what to do next."
Sounds like a hell of a plan to me. Let me know how that works out.
Despite their financial problems, the Copes have worked hard to protect their credit rating, staying current on bills. And they've made cutbacks: trading in Kent's Corvette for a Suburban and getting rid of the gardener, for example.
My gosh! What subhuman straits have we reduced these people to? Have we no decency?
Next we'll hear that the Copes won't be able to participate in Orange County's new rotating nozzles rebate program.
Someone. Anyone. Please.
Stop the madness.
Since he lost his job, Kent has gotten a real estate license and is trying to start a business selling the rapidly increasing inventory of foreclosed homes...
As a stock-trading mentor of mine used to say, "Lessons are repeated until they are learned." Apparently Mr. Cope didn't pay attention the first time, when Mysti lost her New Century job in May.
Or the second time, when he was sliced from First NLC Financial.
Or the third time, which is RIGHT FREAKIN' NOW. We're told that he watched as:
...former colleagues found jobs with other lenders, only to get laid off again when those firms closed up. Kent said some of the sales people he knows who still have jobs are actually the worst off.
"They may be employed by a company for months and months, but they can't close a deal," he said. "They've got the borrowers, but unless that thing is pure gold, it isn't made. It's a commission business. They're to the point frankly where they would rather get laid-off so they can go collect unemployment than be employed and make no money."
"They may be employed by a company for months and months, but they can't close a deal," he said. "They've got the borrowers, but unless that thing is pure gold, it isn't made. It's a commission business. They're to the point frankly where they would rather get laid-off so they can go collect unemployment than be employed and make no money."
And still Our Hero wants to sell houses.
Take your seats again, please, Mr. and Mrs. Cope. Class is in session.
"You can't run into someone who isn't impacted by what's going on," said Kent. "It's very expensive to live in Orange County, and you pay a lot for your home and you can't get what it's worth now."
That's because YOU, Kent, don't get to determine what it's worth. What you PAID for the place has NO bearing on "what it's worth." One of those weird "market" things. Try reading Why Smart People Make Big Money Mistakes if you're fuzzy on this.
And yes, you can pick it up from your local library. It's a jaunt that'll be worth more than the cost of the gas for your Suburban.
Well ... maybe.
You know what I wonder? I wonder just when it is that a wonderful view of the Pacific Ocean becomes not quite so wonderful at all.
Labels: Debt, Homeownership, Mortgages
