mortgage crisis causing divorce?

[adina]

http://articles.moneycentral.msn.com...gDivorces.aspx

So according to this article, it's possible that the stress from being in a house you can't afford is causing people to get divorced. More specifically, financial issues are the number two cause of divorce, right after abuse. Really, I don't think that's anything new. Maybe the cause of the financial issues has changed a bit right now, with prices on just about everything rising, gas specifically.

Interesting? Or nothing new?

[walterick]

I always heard couples argue most about 1) money 2) sex. I guess this shouldn't be surprising, but it is sad...

[another view]

Really, I don't think that's anything new. Maybe the cause of the financial issues has changed a bit right now

That's where I'm at...

[JETA]

I don't think it's anything new either.

I find it a little irk-some that people who buy homes they can't afford are blaming the mortgage industry.

Things are really rough right now in the U.S and it's hitting a lot of people HARD. People who over extend and live on the edge $$-wise are really feeling it. I see it in my own family. Everyone is robbing peter to pay paul.

[walterick]

All the rich folks with money to burn are going to start buying all these distressed properties soon and sitting on them 5 or so years and then selling them and making bank... and the rich get richer and the poor... and now MIDDLE CLASS get poorer. Yay capitalism.

[Skyman]

I am in the process of buying my first home. The crisis down under isn't quite as bad as our economy is a lot stronger, however interest rates are going up, rental properties are getting scarce (forcing the rates up) and it is the poor who are hit hardest. having said that the banks have a lot to answer for. Our bank was quite happy to offer us stupidly large loans (the kind needed to actually buy a decent house in a nice neighborhood) but certainly more than we could afford to repay. As the bank explained it to me: "it is no problem if you don't have the deposit for a loan this big, we will simply charge you an insurance fee (which we will loan you) so basically in the unlikely event that you default on your loan we will sell the property and if the value of the property is less than what is owed then we will claim the balance on that insurance policy." so basically the bank gets the interest you might have managed to pay over the first couple of years before the inevitable rate rises make the repayments unbearable and you default. they know that the value of the property won't have risen as much as the interest on the loan (if it did they would have bought the property rather than give you a loan) but that is ok as they have a nice little insurance policy they are hoping they will be able to collect. so the actual risk to the bank is zero! (well it was until the insurance companies realized that the banks had a lot of bad dept and the bottom dropped out of the market - shhh don't tell the Australian banks they haven't yet worked that one out)

[mwfanelli2]

I find it a little irk-some that people who buy homes they can't afford are blaming the mortgage industry.

I find it a little irk-some that banks who lent money to sub-prime borrowers who any dolt could see couldn't afford them are blaming the homeowners.

[another view]

Our bank was quite happy to offer us stupidly large loans

In the past, banks here in the US would do the same. We bought our house 11 years ago (my second so I had some experience with the process) and the bank had to base the loan amount on only my salary. My wife hadn't been in business long enough for her income to be considered. I didn't have any debt (car loans, anything) but still couldn't figure out how I could pay the monthly mortgage with just my income.

Her business is still around today, and we went ahead because she had been in her field already for years so her business was as close to a sure thing as there is. I had a savings and a secure job so I knew we'd be OK. But - the loan wasn't based on that stuff. I'm sure a lot of people took the biggest loan that the bank would give them with those tempting smaller ARM payments. I know someone who took out a second mortgage while building just to pay for the "upgrades"!

It sounds like you have a good grasp of your own situation. Make sure that if something goes wrong, your whole life won't be turned upside down. Homes always need something that costs money. Ditto for cars and life in general. I would never want to be so close to the line that I would wonder if I'd make it...

I find it a little irk-some that banks who lent money to sub-prime borrowers who any dolt could see couldn't afford them are blaming the homeowners.

Nobody stuck a gun to the prospective home owner's head and told them to sign. I'm a little surprised by your post here - isn't this a case of people not wanting to take responsibility for their own actions?

Should the banks be so liberal with their loans? Apparently not, but letting them and careless homeowners run up the tab only to get a (potential) Federal bailout is a slap in the face to the rest of us who are happily living within our own means.

[mwfanelli2]

Nobody stuck a gun to the prospective home owner's head and told them to sign. I'm a little surprised by your post here - isn't this a case of people not wanting to take responsibility for their own actions?

Should the banks be so liberal with their loans? Apparently not, but letting them and careless homeowners run up the tab only to get a (potential) Federal bailout is a slap in the face to the rest of us who are happily living within our own means.

No, homeowners get what they deserve. But notice that the banks are getting federal help even though it was mostly their fault. If I lend you $100,000 and you work part time at McDonald's, only you are to blame? I deserve to get a bailout?

If homeowners go under, so should all the banks who made those "get a buck fast" loans.
.
Oops wait, time to open my golden parachute!

[JETA]

I find it a little irk-some that banks who lent money to sub-prime borrowers who any dolt could see couldn't afford them are blaming the homeowners.

Unfortunately, there are good lenders and bad ones.

I am an adult. Therefore I never sign on the dotted line unless I completely understand what is going on. I also don't buy homes and cars I know I cannot afford. If I do I see that as my problem.

[another view]

No, homeowners get what they deserve. But notice that the banks are getting federal help even though it was mostly their fault.

I'm not a fan of the whole idea of a bailout. I know there is a negative side to letting the situation work itself out, but remember that when the government throws billions of dollars at something it has to come from somewhere. Sure, the banks took a big risk. Business people do that every day; it's part of making a living. I own stocks, same deal - it's a risk. But I'm not going to go cry to big brother if the investment I researched and voluntarily purchased loses money.