The NY Times published an article describing the dire straights of poor Eileen Ulery. The poor dear is about to lose her home in Mesa, Arizona. A home she has had since 1997 that she purchased for $77,500. So what happened to this victim? Why is this poor angel losing her home?
“I’m not an extravagant-type person,” she said. “I see these big houses all around, and they’re beautiful, but I’m comfortable in my little condo.”
(1) Like tens of millions of other American homeowners, she added to her mortgage balance as the value of her condo swelled, at one point exceeding $200,000. (2) She refinanced to pay off some credit cards and settle into a 30-year, fixed-rate loan. (3) Later, she took out a home equity line of credit to buy a new Hyundai. (4) She refinanced again in 2007, borrowing $20,000, mostly for a new roof.
Point by point:
- Tens of millions of other Americans were stupid and those issuing them loans were irresponsible and greedy.
- Was she forced to use her credit cards? Was there violence involved? If the purchases she made were medical in nature don't you think the Times would be all over that? My bet is that she purchased 2 sweet plasma screen TVs.
- SHE BORROWED ON HER HOUSE TO BUY A NEW CAR. First off, if you are 63 and you can't pay cash for a new car then I'm sorry, you should not buy a new car. Social Security should not be counted on to finance your ride. Second, I recently purchased a '96 VW with 100K miles on it. I'm 39 and make well above the average US salary but I know what I can afford so that my family is secure. She appears to have been making less than what is appropriate to purchase a new car IMHO.
- New roofs are future fixed costs. They are not something that is an unexpected expense. All roofs need to be replaced and planned for. Again if a tree fell on it I would imagine the Times would have mentioned that.
Our mainstream media sucks and if Eileen loses her home then she gets what she deserves.
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