patrick.net

Sorry about the double-post --I didn't see Patrick's new thread until after the fact.

Yup, he has obviously blown his cash out refi. What an idiot. I love these losers who omit crucial facts like that from their hardship stories.

Muggy,

Very reasonable explanation, but...
...if Galindo had made any actual improvements to the house, wouldn't he be able to recoup at least some of that investment when he sold the house?

I think this might be a case for the Hardly Boys!

The SF Chronicle knows that the majority of their readers don't have the sense or curiousity to run the numbers of a 1995 mortgage as HARM did.

They also know that the majority of their readers think that capitalism and free markets are the problem with government control of every aspect of life being the solution. Galindo's situation is a prime example of the evil fruit of capitalism. It is meant to evoke sympathy and look to the nanny-state for answers. Of course, Galindo bears no personal responsibility here.

I am of the opinion that this and a number of sympathy stories like this are to set the stage for a tax-payer bail out.

For the bleeding hearts reading this and thinking that I'm a cold bastard, let me share with you that in the late 80s in another state, I purchased a home where the developer had lowered the interest to inflate the price. I later sold the home at 50% of my purchase price. I've been there and it's not fun. However, I signed the mortgage and had responsibility to repay it.

SFvulture, I sympathize with you, and I respect you. I am sick and tired of people paying things back when it works for them. In the end keeping your word and paying your bills is what really seperates out people of character. People love the idea of sticking it to someone else, or a bank, and they just can't grasp that it is only a short term boost, and they have shot themselves in the foot for the rest of their life when they do. I don't even need to ask, because I can tell that you pulled yourself back up.

And related to the story, why oh why do these people keep having kids they can't afford?

SFVulture,

There are very few bleeding hearts here. I don't recall any. Personally, I have no sympathy for stupid people, especially when I am the one who might get hurt because of their stupidity.

You know, I used to be bothered by that but then I realized, the more losers there are who don't pay their bills, and go around shafting people when they can, the easier it is to stand out as someone solid. What sucks is when the government tries to protect them at our expense. All of a sudden most employers aren't allowed to run credit reports on prospective applicants because of 'adverse impact' , so the government continuously tries to be the great equalizer.
I think if I am applying for a job of financial responsibility, the other guy's bankruptcy is a material factor in deciding between the two of us.

The Article said:

> Ruben Galindo, 44, Castanon's neighbor and a LoBue worker
> for 15 years, said, "Whatever little savings that we have, we
> are just not spending any. We are saving our pennies and nickels
> just to get us through the year.''
> Galindo, with a wife and three kids, also has a mortgage and
> thinks he can handle two months of unemployment, but no more
> than that. He bought his house in Lindsay in 1995

Then HARM said:

> Galindo bought his house in 1995, so that’s 12 years of (presumably
> continuous) mortgage payments, at a much, much lower cost-basis
> than today Has Mr. Galindo cash-out refinanced his house each year
> since 1995 and used the money to take his family on annual round-the-
> world luxury cruises? Unfortunately, this mystery is beyond my limited
> amateur-sleuth abilities to solve. Please help me out here.

Using the amateur-sleuth tool known as the internet I found that:

1. Lindsay is in Tulare County.

2. There are 51 homes in Tulare County owned by people named Galindo.

3. There are 3 homes in the city of Lindsay owned by people named Galindo.

4. There is one home in Lindsay owned by a Ruben Galindo Located at 745 Monte Circle.

5. The Ruben O. Galindo at 745 Monte Circle is 44 years old (so I probably found our man)

According to title records the 1,200 sf home at 745 Monte Circle was built in 1996 and Ruben bought it for $87,500 on 7/96 making a $326 (less than $500) down payment and getting a FHA loan (there is no other debt currently recorded on title).

Bay, that is a great point. In my opinion most people don't understand what being a real man means anymore. Ask most people of a profile of a real man, and you will get an answer resembling some loud mouth WWF wrestler, instead of someone of character who takes care of their business. I'm sick of going overseas and being embarrassed to be an American because these fat bellied loud mouths think they can treat the locals like crap because they have a credit card to wave around. I have quietly been rejoicing the downfall of these arogant turds.

Look, I'm as against living beyond one's means as much as anyone. I have made some sacrifices in order to strive to not be in Mr. Galino's situation.

But I have also been blessed. Nobody has had expensive health problems, and we haven't had lapses in medical insurance, in spite of job losses.

When I was in college, I had a roommate who was not a student. But he had to live with roommrates who were a lot younger than him, because he could not afford his own place. He had owned a small gardening business. He didn't bother anyone, and could support himself fine, thank you very much, with his little business.

Till an under-insured drunk driver crippled him. Sure, he could sue the drunk driver, who was by then, doing time in prison. How much do you think he'd get? And how far do you think the state mandated liability insurance ($35K) would go at the time? Life isn't fair, and sometimes bad things happen to good people.

Does M. Galino have medical insurance?

Did he or one of his dependents have a major health problem that ran into a lot of money?

I don't know, but I don't think you know either.

Sybrib,

I'm pretty sure they would have printed any medical problems as it would really have increased the sob factor.

Maybe.

Maybe not. We just don't know.

It said the employer recently dropped coverage for dependents.

Once, I had a colleague who, like me, had medical insurance. He also had a lien or garnishment or something like that because of a complicated Cesaerian procedure that his wife had before he'd got the job with the insurance. It was a debt they'd had hanging over their heads for a long time, slowly paying it off.

My point is that it is not impossible that even though the employer presently had medical insurance doesn't necessarily mean he wasn't made poor from something that had happened before.

The article didn't say.

We just don't know.

I agree.

But unless we know for certain, we ought not to assume that he made himself in trouble by borrowing from his house for round the world trips and things like that.

Maybe he did it to pay for medical bills. His, or someone else's.

So unless we know, we ought not to judge.

Sybrib, you have a point, even though I don't believe it applies in this case that is pretty much the only time that I sympathize with someone. A couple of thoughts for you:

Poor people are covered by different state programs, and yes, the lower middle class do get shafted because they don't have the means to buy insurance, and they don't qualify for the free stuff. I do support safety nets, and it pisses me off to hear stories of uninsured people being billed at a higher rate than the 'negotiated' rate insurance companies pay out. Point taken.

Another thought though is when people go through their whole lives blaming a medical bill for ALL of their problems. It seems like every deadbeat I have come across blames some medical incident from 8 years ago. I do believe that that a situation as you describe is a legitimate reason for a bankruptcy, unfortunately for these guys, they were so happy to screw the credit card companies for their cheaply made furniture that they used up that wild card of last resort.

It really is a tough pill to swallow but most people in these situations are there by their own doing.

One great thing about the media though is that they are always looking for a genuine hard luck case to profile. It is one of the pleasant things about living in this country at this time. I really like the shows like Extreme Makeover, and we do have a duty as successful people to be charitable. I give to St Judes because those diseases do randomly strike people, and they never turn people away for inability to pay.

Even the worst case of cancer wouldn't wipe out the equity of a home that was owned for 12 years.

My hunch is that is really the case in this example but I try to give the benefit of the doubt.

It's kind of fun to see the look on someone's face when they run out of excuses as to how they got themselves in a situation. Trust me, I've seen it first hand. I used to own rentals. I never knew there was such a large percentage of the population that lived that way. Running and running from their problems. I worked somewhere once where a guy got irriated with me because out of the blue he comes up to me and tells me how unfair it is that the interest on his unpaid child support brought his total amount up to $40,000. I just looked him square in the eye and shrugged my shoulders. He got the most F'd up face you ever saw. I guess since he was a friendly guy named Buddy he was used to being babied.

Maybe he's just greedy and doesn't want to sell below the peak house price. People are like that, you realize.

Just today a co-worker was telling me that the equity in your house is "money in your pocket". I didn't really punch through with the comparison to unrealized gains in stocks. Even if you sell at a profit, you can't access the cash until you sell the house. Unless you take a home equity loan, which is not really getting the cash, it's just getting a loan using your house as collateral.

For the record, I don't have a problem with people using such an approach, as long as they understand the risks.

Another poor "victim":

http://cbs5.com/video/?id=21405@kpix.dayport.com

That was awesome. That really is the poster child.

. As in: figure out how to break the laws for your own benefit, usually with the ethical proviso that ‘everyone else is doing it’.

What? I denounce law-breaking. The idea is to obey the law.

Ultimately the consideration is that people can be trusted not to act in the way described in item #1.

In a free market, self-interest creates public good.

Let him eat cake!!

Did I hear cake? :)

How about some rum cake?

# FormerAptBroker (9:28 )

http://cbs5.com/video/?id=21405@kpix.dayport.com

I just finished watching "Casey the Poster Child".

I loved the reassurance that "federal regulators" are investigating! Don't make me laugh. We are almost one fourth through 2007 AD and the feds are just waking up to this?

Maybe the feds and Casey will learn:

a) Adjustable Rate Mortages are adjustable
b) Subprime is subprime
c) High risk borrowers are high risk.

Bottom line: Casey say a way to make a quick buck and got bit in the ass and is a liberal media poster boy.

Let's look at that point. So regulation, and control logically are the answer according to Reality's post. Ok, but a quick refresher.

These same bums that caused this crisis, and yes it is a crisis, compared to another Katrina are the same ones who would have cried to the courts and Congress if they weren't allowed loans. You know, the great Equal Credit Opportunity act which now gives every impoverished bad credit minority a legal standing to sue if they are declined credit. So the standards are relaxed by the the 'regulating' government companies of Fannie Mae, and Freddie Mac. Beautiful, so now we have a time bomb, and prices go wild with this historically wreckless spending spree.

Of course it is no one's fault because, hey there is no accountability and no one is responsible for their own actions so the media plays the blame game, and lenders are paraded in front of Congress. BTW, I called that one over a year ago.

Now the obvious answer is to regulate and dictate acceptable lending standards since; no one is responsible for their actions. Now we only lend to qualified borrowers. Terrifc.

Now we shrink the pool of borrowers which does what to demand and prices? pause for answer........... yes! it shrinks both.

Cool, so now not only are speculators and wreckless borrowers hurt, prices drop to where everyday people can't sell, and in all of this they find out that they overpaid because the comparable sales were padded with all of the cash back scams pointed out in Former's link.

I guess I'm also a retarded hypocrite because somehow I don't see regulation solving this problem, and yet, I believe people should have the freedom to chase their insatiable lust off of a cliff if they so choose.

@Sybrib,

It's true that we cannot cast too many stones because we don't know all the facts of Galindo's story, however...

The facts as presented in this typical "victim" media story simply do not pass the "smell test". The story paints a portraint of Mr. Galindo and definitely draws a conclusion (victim) that simply does not square with the information provided. Either the journalist was too lazy to ask the right follow-up questions, or simply decided to take Mr. Galindo's story at face value because the material fit so well with the "theme" of the article. Either way, I'm not buying it "as is".

Some of the other posters' comments I particularly agree with:

I’m pretty sure they would have printed any medical problems as it would really have increased the sob factor.

It really is a tough pill to swallow but most people in these situations are there by their own doing.

FAB,

Great detective work! If you want a job at the HARM-X Bullshit Detectives Agency, you're hired.

Who is Malcom?

Just trying to follow your logic.

I get very excited when someone says s/he hates me. Come again please. :)

I think many experienced writers either quit or were laid off = Google Effect

@Reality,

Personal attacks against other bloggers will not be tolerated here. If you want to engage in that kind of baseless name-calling, I recommend either Craigslist or the Wall Street Journal real estate blog --they seem to thrive on that kind of stuff.

You have been warned.

I need to stuff my face some more. Where is my cake?

You know, one thing you said does scare me, because my worst case scenario for all of this is not France, but more the communist revolution. Enough people are affected, and they are masses of losers like the peasants of Russia, China, and France, that it is conceivable that there could be an upheaval. Reality, you could actually get your way, we could have regulation, price controls, tax payer bailouts, and more restrictions on our freedoms.
As for your other comments I trust the other readers more than I trust your opinion of my thoughts. You might take a minute to reflect that all of the links, all of the stories show without any shadow of a doubt that we have been right all along.

Again no point. What is your deal?

It's cute that you are trying to be clever, but I am really trying to see if you have a point of view or if you just had a bad day, or maybe you have a lender calling you demanding payment.

Maybe you should have started checking this site out beforehand. It has been observed that most of the people that have a problem with us don't like the message because it is bad news for them. You are not the first.

Hey, Peter P,

I don't know if you noticed how I worked food into the thread topic, but I was thinking of you ;-) .