Comments on: Nope, No Savings Here. Or Here. Or There.

By: Michael

Michael — Tue, 11 Oct 2011 13:59:08 +0000

Yeah, there’s a lot about the survey that isn’t clear. But that’s pretty standard, I think, in that results from surveys are usually geared to get attention.

With all the evidence on display that banks are not even trying to get the foreclosure process moving for months and years, maybe some folks just consider their mortgage a good place to stop-up their outflow. Its not irrational.

Bingo. Though, if you have equity in your place, the bank will be at your door within moments of missing a payment.

By: Mike

Mike — Mon, 10 Oct 2011 16:00:35 +0000

I think there’s an additional question / dimension here. Does that mean these folks don’t have enough in savings to come up with one payment? Or would they prioritize their money to other needs? With all the evidence on display that banks are not even trying to get the foreclosure process moving for months and years, maybe some folks just consider their mortgage a good place to stop-up their outflow. Its not irrational.

With the cash I have in savings I think I could make about 4 or 5 years of my mortgage payments – but if I add in all my expenses (cobra payments, groceries, etc.) and what I planned on some of that money being used for (car replacement), etc. I could imagine responding to some survey that I might miss a payment 6 months after loss of income. However, my family would definitely find some way to get more income ASAP, and we would probably be able to make our mortgage by just delivering pizzas at nights or some such. We made sure we would never take on a mortgage that was hard to afford. Actually our tenants pay our mortgage we just have to cover our taxes and insurance at about $250/month. But if we assume no government goodies, living only on our savings and still paying for health insurance, I think after five months or so when our savings got well past the halfway point, I would consider missing a mortgage payment and keeping that money in our account instead.

It’s kind of a silly what if game for those of us who do save up and plan ahead. We’re probably the same ones who wouldn’t let our incomes stay at 0 for more than a week anyways.

By: her every cent counts

her every cent counts — Sat, 08 Oct 2011 04:55:24 +0000

That’s really scary. There is so much focus on people making less than $100k a year, but an even bigger problem is that so many people who are in the middle class and upper middle class spend more than they should on their lifestyle. That’s why I’m waiting until I can buy a house outright. It may never happen, but I’d be terrified to have a mortgage where, if I lost my job, I’d be SOL. The way the country is right now, it seems like we’re headed for a much worse recession.