House Poor

What Would You Do With Just $350 Billion to Spend?

I used to think like you until my husband got transferred in his job.
We bought a house in 2005. The price of the house was 2X our income. We put 20% down and have been making our payments for over 3 years. Imagine our shock last week when we contacted a realtor. She told us the value of the house now is worth less than the loan amount. We know all the money we saved for our down payment is gone. What we don't know is what to do now. Do you try to rent an out of state property at a monthly loss? Do you walk away and ruin your credit? It was a new housing development when we bought, so every other family that bought there is in trouble as well, whether they know it yet or not. Hopefully none of them will lose a job or have to move for another job. Insanity!!!


On Jan 13 01:42 PM John Polomny wrote:

> "Still, what exactly should the money be spent on? I’m tempted to
> say: housing, because this continues to be a major unresolved problem
> that looms over both consumers and their balance sheets. Unfortunately,
> however, the banks remain a greater priority."
>
> No and No. Housing got into trouble because of malinvestment, greed,
> and flat out fraud. The only thing that can solve the problem is
> to let the price of houses fall until they reach market clearing
> prices. As far as the banks, quite a few of the large regional banks
> are not in trouble. I have no problem with letting the likes of Citigroup
> go under along with their inept management. Other investors, banks,
> managers will then come in buy the bankrupt assets and then the healing
> process will begin. Rewarding failure and the losers who made bad
> calls at the banks during the bubble is no way to fix this problem.