Two friends go about their lives, taking out student loans, buying cars and homes, and taking on a bit of credit card debt. While their expenses are identical, their credit scores—and corresponding monthly payments and interest charges—are not. Over a lifetime, the person with credit rated “fair to poor” can expect to pay over …
Companies & Industries
How Homeownership Is Like Marriage
There are forces that eagerly want you to enter these institutions—the federal government with homeownership, nagging family members with marriage, and society as a whole for both. You hear over and over that entering into these commitments is the fulfillment of a dream. But neither homeownership nor marriage is right for everyone. And …
Dollar Store: Great Values or Total Waste of Money? And 5 Other Consumer Debates
Five Million Homeowners Underwater. How Many Will Walk Away?
It is estimated that by June, about 10% of all homeowners with mortgages will owe more than their homes are worth. With strategic defaults on the rise, many homeowners who actually do keep paying the mortgage each month are increasingly feeling like suckers. Are we headed for a mass default?
Double Standard: Of Morals and Mortgages
You’ve probably heard that a high-profile realty group that had agreed to pay $5.4 billion for a New York City housing complex just announced it was not going to make good on its loans. You might describe the (former) owners as misguided, stupid, or unfortunate. You probably wouldn’t think of calling them immoral. So why is the average …
Why Renting Is Stupid, and Why Selling a Home Now Is Even Worse
Suck it up. Stop whining about your underwater mortgage, and stop thinking that renting is a better alternative to owning a home.
Strategic Mortgage Default: The Irresponsible, Amoral, But Best Strategy?
If you voluntarily walk away your mortgage because you owe more than the home is worth, are you a bad person? Should you even care?
It Was an Awful Year for the Economy. But a Great One for the Consumer?
The most obvious upside to being a consumer this year was that you felt wanted, and you felt appreciated. In a bad year for business, retailers were very, very happy to have yours. You felt the love—though sure, they only “love” you for your money. It wouldn’t be the first time somebody was happy to be in a relationship with a gold digger.
Great Expectations in 2010: More Personal Savings and Cheaper Food, Heat, Electronics, and Homes
As we leave 2009 behind, there are many signs that life will be way better in the year to come.
On Reverse Mortgages and Home Projects That Just Don’t Pay Off
As far as anyone can foresee, it’ll continue to be a bad market for home sellers for some time to come, leading many homeowners to consider reverse mortgages or remodeling projects rather than selling at a lowball price. But both have their share of pitfalls.
You Just Strategically Defaulted on Your Mortgage. What’s Next? ‘We’re Going to Disneyland!’
Approximately one million American homeowners will strategically walk away from their mortgages this year. Why? They’re underwater on their mortgages, and the rental market is so cheap that they can live large by paying a landlord instead of a bank.
Odd Economic Indicator Round-up: More Jews Moving to Israel, More-Cramped Cubicles, More Smoking and Surfing Porn
Perhaps they’re not quite as odd as the Hot Waitress Index (a theory in which waitresses get increasingly more attractive as the economy gets worse), but these trends are still rather unusual—yet revealing—indicators of how the economy is faring.