Sorry I have trouble keeping up, are you the fellow with multiple store locations and some real estate holdings from last yrs threads or am I confusing you with another poster here?
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200 a month !!! Really?
- Thread starter gcrouse
- Start date
Sorry I have trouble keeping up, are you the fellow with multiple store locations and some real estate holdings from last yrs threads or am I confusing you with another poster here?
You're taking on debt. There is a risk associated with that debt.
If something bad happens, there is a possibility that you could lose the house.
That needs to be taken into consideration, when you look at buying toys or even some basics.
I know a few people that have bought houses cash.
True, but it doesn't follow that one is living beyond one's means by taking out a loan, whether it be for a car or a house ("mortgage.")
The problem has already been described well: People buying too much house and then piling on student debts, credit card debts, multiple car loans and failing to reconcile their income against the debt load they take on.
I'm among those that are debt free. No credit card debt, no auto loans, no mortgage. My wife and I bought modest in an affordable city and while we had two cars, both were older, cheap beaters we used while we put every cent toward the house. We didn't actually have a mortgage; we had a substantial down-payment from previous savings and used a line of credit for the house. We didn't eat at restaurants, didn't furnish the place with the fanciest stuff, didn't put in the $50,000 kitchen etc. I had an electronics business as a 2nd job at the time and put most of my income from that into the house. We paid it off in just a few years. My wife celebrated with a new car in 2005 & paid cash; she still drives it now. My Subaru was fairly expensive but used; paid cash. My Fazer was used; paid cash. My CBR was new but pretty cheap; paid cash.
Going by property assessments our house has roughly doubled in value compared to what we paid 16 years ago (at least in absolute dollar terms...) The debt we took on was certainly not a bad thing or a sign we were living beyond our means. We carefully approached and managed the debt and came out smelling like roses.
If "something bad" happens and you can't pay the rent on your apartment you're just as out-on-the-street.
Must be an incredibly rare thing. Maybe such people come into an inheritance or had shares in a start-up that was bought by Google. Or maybe they took a risk, got a mortgage on a fixer-upper, flipped it and made a bundle and rolled that into another house etc. Hard to picture someone saving a quarter million dollars or more in a reasonable amount of time by socking a bit of each paycheque away each month.
Buying houses for cash is incredibly rare, if your a Canadian. Asian offshore and Russian money often buys GTA housing with cash.
My Dad never had a mortgage, bought our houses and a farm and cars and toys for cash, never had a CC. He was a saver and our life was very basic. It can be done. I'm not my Dad.
BTW a line of credit, if secured by the equity in your house is a mortgage for all intent and purpose.
My Dad never had a mortgage, bought our houses and a farm and cars and toys for cash, never had a CC. He was a saver and our life was very basic. It can be done. I'm not my Dad.
BTW a line of credit, if secured by the equity in your house is a mortgage for all intent and purpose.
I know a few guys who buys houses cash as well...they're called investors and flippers. My old realtor did it all the time. Buy cash, flip in a few weeks, cash in, rinse and repeat. If he really wanted to get away with it...buy house, fix, give to cousin/niece/nephew/grandma/mom/dad and let them live while it appreciates tax free...
IMO government should be going after the flippers who are living off this type of business and skirting the laws of capital gains tax. Plenty of them out there, close the loop holes, and once they have to add capital gains tax to their expense of flipping, it won't be as lucrative anymore.
IMO government should be going after the flippers who are living off this type of business and skirting the laws of capital gains tax. Plenty of them out there, close the loop holes, and once they have to add capital gains tax to their expense of flipping, it won't be as lucrative anymore.
Stupid is not too harsh to describe people's actions, it's actually quite accurate. My sister works at a bank as a financial manager and the stories I hear are appalling. I can't remember the exact stat, but something like 50% of Canadians are one paycheck from bankruptcy. This is not accidental, it was intentional and self inflicted...stupid. I have a mechanic shop and the number of times I've heard a customer say to me, "I can't afford $1,000 to fix my car. I'll just buy a new car" is unbelievable. The average car sold in Canada is $30,000. How is it possible to be able to afford to spend $35k after taxes for a new car, but not be able to afford $1k for repairs?
Is it really that hard to come up with a battle plan that includes a cost/benefit analysis? You gotsta live somewhere amirite. Consider the mortgage as a savings account. My mortgage was open. Took much delight cramming in max $ because I could calculate how much interest I wasn't going to pay over 25 years. The money I paid in goes back to me. Plus I live there. Do I care that the borrowed money wasn't backed by gold? I couldn't afford to buy my house now, I only make $42hr. I'm glad I didn't save for my house is what I'm saying.
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Nope. Sold it all! Only had 1 extra real estate holding but that was sold off a year and half ago.
A few years ago McD's ran a campaign "You deserve a break today."
What does the average person do that they deserve a break? Cure cancer, rescue damsels in distress?
You don't deserve a break for getting out of bed and scratching your butt. You're no more important than the other 7.4 billion people on the planet but we need to fluff our feathers to appear important. So buy the prestige car and clothing. Name drop the exclusive club and restaurant dates.
BTW what's so great about granite countertops?
The hard surface makes the kitchen noisy.
They scratch and need to be polished.
They are unforgiving. Chipped and broken dishes are the norm.
What does the average person do that they deserve a break? Cure cancer, rescue damsels in distress?
You don't deserve a break for getting out of bed and scratching your butt. You're no more important than the other 7.4 billion people on the planet but we need to fluff our feathers to appear important. So buy the prestige car and clothing. Name drop the exclusive club and restaurant dates.
BTW what's so great about granite countertops?
The hard surface makes the kitchen noisy.
They scratch and need to be polished.
They are unforgiving. Chipped and broken dishes are the norm.
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I'm one of those people. Took working a few different careers over 20yrs, renting small places, and riding ugly cheap bikes. Bought the exact home I wanted in the location I wanted at the right time in that market. Then 4yrs later value had almost doubled, the Ex wife did the numbers and decided I had fulfilled my purpose and pulled the trigger. She got the house, the dogs, the ***** even kept my ice trays. Now it's 18mos later, she's got almost $80k in debt on the house, and we're both $200/mos away from going under.
Manufacturing wages have been practically stagnant for 15yrs, I haven't had a full time job in close to 4yrs only managing to survive by living contract to contract working maybe 9mos out of the year. I haven't been able to add to my RRSP for 6mos, renting a single room in a shared condo (where my rent doesn't even cover the cost of hydro, mandated Bell internet & utilities). The government is spending like a drunken sailor while destroying the economy of Ontario and finger waggling that the rest of us need to "smarten up", and oh yeah Ontario has more debt than any other comparable region IN THE WORLD.
Let that sink in a for a sec. Ontario has more TOTAL debt than CALIFORNIA. Not per capita, TOTAL. All while being a have not province, with stagnant growth and no plan except to spend more.
Ontario is buggered up the ***, and it's not because somebody bought a house $150k more than they could afford. That kind of logical fallacy is what led to this destructive reign of terror that has utterly gutted Ontario and left it the house of cards that's $200/mos away from falling down.
I guess i love my broker.
I went to him, and his question was "what house value are you looking at" so he got me approved for that amount + 20k just to give me some leeway.
No pushing or anything.
Makes me glad i stayed away from the bank directly (ironically i work for one).
When i went in for some paper work at the bank a few months later (before close), the account manager asked me what rate i got and was wide-eyed when i told her.
Checked with her mortgage specialist to see if they could match and it was a no-go.
But yes, i realize that i am living outside of my means. Which is sad, especially since my salary has increased drastically since i got the house. Makes me wonder how much kraft dinner id be eating if i didnt get the new positions.
On paper it looked fine, but in reality, everything ends up breaking down.
Also we can't blame the banks for overspending, just like we cant blame restaurants for being fat.
Slow down there Donald, we can fact check...
California Debt: $470B USD
Ontario Debt: $302B CDN or $230B USD.
So, your statement is not even close to being true.
Per capita, now that is the huge f-ing mess
California per capita: $11,990 USD
Ontario per capita: $21,800 CDN or $16,600 USD
Now some really interesting numbers, state/provincial PLUS federal debt per capita California and Ontario
California: $71,000 USD
Ontario: $39,400 CDN, no point in converting...
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I'm not saying that buying a house is a bad thing, or people shouldn't do it.
Just remember that it's kind of the bank (mortgage lender) that's buying the house, and you are kind of on rent to own.
The only way to realize any gain in the property value, is to sell the house, or take out a bigger loan on it.
Best to pay it off a.s.a.p. That way if your income takes a drop, you're not on the hook for payments, or foreclosure.
Just remember that it's kind of the bank (mortgage lender) that's buying the house, and you are kind of on rent to own.
The only way to realize any gain in the property value, is to sell the house, or take out a bigger loan on it.
Best to pay it off a.s.a.p. That way if your income takes a drop, you're not on the hook for payments, or foreclosure.
Dresden
Well-known member
Assuming you're not trolling hard - saying that taking on a mortgage is living beyond your means is laughable at best.
I guess you think we should go back to the days of bartering? Why bother with paper money?
Perhaps you belong in Medieval times!
I'm not a wizard with facts but it seems like you're renting the money. I don't have a better idea of how to get large quantities, fast. Maybe we have a different definition of "living within your means"? dunno.
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