The blog of Brian Kirsten

More foreclosure madness...

These folks should never been allowed to buy houses...

Some South Floridians who lose their houses to foreclosure try to get even. They'll strip the plumbing, ruin the carpets and rip out doors.

Exasperated lenders are getting wise to the ruse and offering "cash for keys" deals, essentially paying homeowners as much as $2,000 not to take out their frustrations on their properties before leaving. Roughly half of all foreclosed properties are returned to the bank with substantial damage, according to a national survey of 1,500 real estate agents by Campbell Communications, a marketing and research firm in Washington, D.C.

Facing foreclosure, residents are trashing homes

Understanding the Credit Crisis...

Or why the subprime meltdown could mean a world of hurt for us Americans.

As is often the case with innovations, though, there was soon too much of a good thing. Those same global investors, flush with cash from Asia’s boom or rising oil prices, demanded good returns. Wall Street had an answer: subprime mortgages.

Because these loans go to people stretching to afford a house, they come with higher interest rates — even if they’re disguised by low initial rates — and thus higher returns. The mortgages were then sliced into pieces and bundled into investments, often known as collateralized debt obligations, or C.D.O.’s (a term that appeared in this newspaper only three times before 2005, but almost every week since last summer). Once bundled, different types of mortgages could be sold to different groups of investors.

Can’t Grasp Credit Crisis? Join the Club (Link courtesy of BoingBoing)

Using Mint

I recently decided to register for Mint (the financial website not the one the measures traffic) because it came highly recommended in one of the many blogs I read during the day (I don't recall which one...sorry). I knew little about the site, just that it was supposed to munge together all your finances to give you a better idea about how financially screwed you really are. I initially thought that recommendations for the Mint website were some sort of terrible joke. After registering I tried for most of the afternoon to get any account information into the system with no luck. The site was tremendously slow and unresponsive. I later came to realize that Mint had just won the TechCrunch40 award, so that would explain the site's slow response time. I returned a few days later after the furor ran down, hoping they'd spent their $50,000 winnings on some additional servers. Returning to Mint's website, it seemed a bit more responsive and I was finally able to add several accounts to the system. The concept is fairly easy, after registering you search to see if your bank or credit card company appears on the list that Mint can interact with. If you do find your bank or credit card provider, you then enter in your login information and several minutes later (or in my case hours later) Mint connects with your accounts and downloads your transactions. I was fairly surprised with the sheer number of companies Mint claims to be able to talk to. I didn't have troubles with a majority of my accounts, Mint still can't connect to a particular credit card of mine (although they claim they can) and for some reason Mint still can't talk to my Etrade bank account (which Mint also claims they can talk to).

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Robert Kiyosaki and the housing market

"Do you think the Federal Reserve should intervene to save the economy by dropping interest rates?" My reply then as well as now: "No. This is a capitalist system, not a communist one. Anyone who expects the government to bail them out every time their greed and stupidity causes them to lose money is being foolish."

More Mortgage bad news

Nation's mortgage troubles worsen Homeowners with adjustable-rate mortgages, struggling to deal with sharp increases in their loan payments, pushed the nationwide foreclosure rate to a record 0.65 percent this spring as the crisis in subprime lending intensified. The problem was largely limited to the industrial Midwest and to four housing-boom states -- California, Florida, Nevada and Arizona. But some economists warned that the situation will worsen in coming months as an estimated 2 million more adjustable-rate mortgages, taken out with low introductory interest rates, begin resetting to much higher rates.

10 Reasons You Should Never Get a Job

10 Reasons You Should Never Get a Job

You only get paid a fraction of the real value you generate. Your real salary may be more than triple what you’re paid, but most of that money you’ll never see. It goes straight into other people’s pockets.

5 lessons on becoming a millionaire

I figured that earning a million dollars should be pretty easy if I could determine how to provide at least a million dollars worth of value to others. Unfortunately I don’t know how to provide a million dollars in value to a single person (and get paid for it), so I figured I’d have to make it up in volume… maybe by providing $1 of value to a million people. I know I can create something that’s worth at least $1 to someone – one good article should do it — so the key is figuring out how to get that value into the hands of as many people as possible.

Subprime mortgages affect our brains

FMRI research shows that long-term decision-making takes place in a different part of the brain from short-term decisions -- so when you offer someone a cheap two-year mortgage followed by 28 years of scorchingly high interest rates, the short-term side jumps in and overrides the sober long-term mind.

The scariness that is mortgage lending…

Taken from the Prosper.com forums: (The full post)

One of the things I've observe walking the neighborhoods in my neck of the woods is the push effect caused by loose lending standards. There was a neighborhood of $150K to $200k homes I walked that had become populated by what appeared to be ghetto people. It was once populated by middle class families but they had put their modest homes up for sale and traded up when the loose lending standards allowed the low income to buy homes in formerly working class middle income neighborhoods. I imagine these middle income families then invaded a higher priced neighborhood, again with the help of loose lending standards, and then displaced the upper middle class to even more expensive neighborhoods and so on and so forth. When the market fully collapses, everyone will fall back into the neighborhoods they really belong based on income and class. That may leave lots of homes heavily discounted due to the excessive construction caused by the housing boom.