Never say never, and never imagine that the "correct" course of behavior is always the one that will be rewarded.
For example: the upcoming resets in ARMs that everyone's been worried about, given the banking sector? No problem -- there's such a misery of doom & gloom and the flight-to-safety has been so strong, that for the moment, most folks with adjustable mortgages are about to get a discount, while those of us who 'did the right thing' and locked in "low" interest rates while Bernanke was inflating the money supply will continue to pay out through the schnozola.
So, independent of anything that the cretins in Washington D.C. would bring you, the natural business cycle's current supply of deflation is bringing mortgage relief to all the nation's household-roulette players, and of course, to my twin, the lucky bastard....
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I almost wonder if this was the real reason for Bernanke's cranking the rate so low and turning the printing presses up to 11. Of course, anyone with savings will pay for it in the end, but since the net aggregate savings rate in the U.S. has been negative for many years, this'll likely mean that we're screwing over the Chinese and the Germans.
Bastards... Humbug, I say unto Thee! (c:
2 comments:
You and I are in the same boat, except I still haven't been able to refinance my fixed 30yr mortgage stuck at 7% with a 15yr 2nd mortgage (my "down payment") at 9.5%.
And I've been putting money into savings for a long time. Don't you just love how the old traditional behaviors of virtue somehow become the practices of chumps?
Still, I didn't have the fear and short-term pain that those with ARMs had recently, so I'll stick with my decision and "built character" and stop whining.
Say....you don't suppose we should get together and start selling off our excess of character built over the past 14 years do you? Maybe we'll make a pittance or two.
I'm not sure in this case, that I was actually lucky... you yourself forecast hugely inflationary fed habits, as the US' Pyrrhic choice between, if you'll excuse stretching a gory set of metaphors to finance, slashing our risks and hoping that we can eventually clot (trying to inflate our way out of the mess), versus sucking on a shotgun (actually doing things right, and let the chips fall where they may).
That made holding onto an ARM the obvious thing to do. The difference between myself and a lot of the others being that I'm *real* lucky to have been in a relatively stable market in the first place, and that we got into the ARM with the explicit strategy of overpaying the 15-year rate, and are sitting at 53% of the original principal left to repay.
Plus, as soon as all the mortgage people start saying "ditch your ARM," well, my own experience tells me they're talking to suckers. If it was in the borrowers' interests, the banks wouldn't be pushing it, since the mortgage-refi game is less a zero-sum game as a zero-sum lambada, complete with NC17 bits.
Since mortgage interest payments remain 1040-deductible, nobody's really getting screwed here, so long as they retain their jobs... which is what makes the ARM risk acceptable. Just keep on overpaying, and ignore the shysters and their fnords.
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