I sit here feeling a little out of sorts. I finally received the default notice on my house. My heart sank. I have nearly $350,000 hard cash in that house and yet it is underwater. It makes no sense anymore trying to hang onto it.
Circumstances put me in this position just as it has for so many others.
Those circumstances led me to take the serious move to become retired and shed all the golden handcuffs. Losing a partner didn’t help, but that’s another story. A new guy, an airplane and the word “adios.”
I had a successful career in real estate but everyone reading this column knows someone who has been in or affected by the real estate collapse.
That would include all the loan officers, offices and brokers that used to exist. Title companies were merged, modernized and cut back on personnel.
Real Estate Agents who could not land the plum bank REO listings had to grovel or get out. It really has been tough. There are agents who do very well, but most have had to struggle or quit. Most have ruined credit because real estate was always considered a good retirement investment.
That is where my retirement was. Many of us just got stuck with a lot of real estate that is now worth less than is owed. With income hard enough to come by and at a premium it is very hard to hang onto something that has a ton of real investment dollars in it when it is sucking you dry.
I can tell you one thing though; if someone in the power circles of government would get off their duff and adopt my 2 Percent Solution (see my column from Oct. 28). I wouldn’t lose my house, nor would anyone else.
I, and everyone else, would faithfully pay on their upside down mortgages faithfully every month for the next ten years. Dumb logic tells you houses will be worth more than what is owed come 10 years from now.
Everyone wins, but no.
The government (which is the Fed) and the banks they are tied to, including and more specifically Fannie Mae and Freddie Mac, for some strange reason, want or need us to suffer. At least that’s the way it feels to me.
To me it all seemed to start innocently after the 2004 elections. The subprime loans flooded the market for the first time. They were pushed until late 2005 and then the Fed began raising the discount rate (interest rate the Fed charges banks to borrow from them) for at least 14 straight quarters (thanks to Alan Greenspan who had endorsed the subprime 1 percent interest rate loans) until we suddenly crashed just in time for the elections in 2008 when it became a major “Crisis.”
Everything is a crisis now. I, and many of my similar thinking ilk find it rather odd how an unknown one term State Senator/Community Organizer from Chicago just happened to give the keynote speech at the nomination convention of John Kerry. Seriously, who ever heard of such a thing.
Can you think of any obscure person giving a speech in such a high profile setting ever before in our history?
But boy could he give an inspiring speech. Since then it seems that our whole economic system has been out of whack. Ask anyone in real estate including landowners and builders.
It’s been brutal and to me, using 20/20 hindsight, it almost seems like this was all staged and planned. The guys at Fannie and Freddie that broke the system are now working in high consulting positions in the current administration and still taking enormous six figure bonuses every year.
They should all be in jail with Madoff. You can Snopes this by the way. Raines, Geithner, Paulsen and many more were part of instigating the subprime market while they were with Goldman Sachs, Fannie Mae and the Treasury.
Oddly enough though, government workers seem to be doing just fine. Most government workers make some serious income with phenomenal benefits.
The last I checked, I believe local governments still have a healthy number of employees in the building departments even though little or no construction is taking place. Everything seems so backwards nowadays.
If you’ve been following me here you know I bought an oceanfront retirement condo in Puerto Vallarta for a song and some magic beans. Ah, Puerto Vallarta. I miss it so. But, darn, if I’m going to be able to pay for travel and live there basically for free seven-plus months out of the year, my condo has to be rented out, especially in the high season.
I’m daydreaming again of those turquoise 80-degree waters and thigh-to-head- high perfect rights at Punta de Mita where, although we’re approaching winter, there are white sand beaches with lots of bikinis and bronzed bodies.
I know I’ve brought this up before but in my next article I will touch on the medical care in Mexico.
It has become quite an alternative for those without insurance or those who live in countries with socialized medicine. So, until next time, be good to your neighbor and brother and remember…may Peace be with you always! See you soon.