Credit Crunch?

[Vic]

On TV and print media, all I hear is how the credit markets are frozen up. But, NOBODY that I know is having any problem borrowing money.

Are any of you having trouble?

 

[Patman]

TV media says lots of stuff that is not fully fact based or might not apply to the entire country. Of course since it happens to be happening within a month or so of presidential elections might just be a strange concidence.... or not.

I've really been trying to NOT borrow and becoming debit free then keep it that way through self financing things. It's a different mindset but one I'm sure will pay off, I just wish more people would consider it instead of getting in over their head through easy finance options.

 

[IndyMX]

I recall the same thing happening during the late 90's.. There was this economic collapse happening, but it was only affecting your neighbors.. Not yourself. Some of the media was actually trying to portray it that way. that you may not be seeing any slowdown, but your neighbors definitely were.

Same sh!t, different candidates.

 

[ericz103]

Got talked into financing a bike the day that congress orginally voted the bill down. Kind of funny i thought, got back from the dealership, turned on the TV and heard that no one would be making loans...

 

[IndyMX]

The loan you got was just a myth.

 

[dirt bike dave]

As far as I can tell, it was business as usual around here during the 'credit crisis'. Car dealers open, homes being sold, bank branches keeping normal operating hours. The local paper had an article where the bankers were basically pleading for customers to come in and take out loans.

FWIW, I think I got just as many new credit card offers in the mail the last few weeks as I usually get.

Makes you wonder why all the 'fear' being spread by the media? I know 'fear' sells, but do they have another agenda? Like perhaps they think bad economic news makes it more likely to get a change in the party of the president.

 

[whenfoxforks-ruled]

The fear propaganda could not have been at a better time, this means tv ratings and consequent revenues. Problem is people believe it, and it effects the market!

 

[_JOE_]

I just had to buy a new washer the other day. As it was an emergency and I didn't have the extra cash, I opened a line of credit with the appliance store. I asked the lady if people were having any more trouble getting approved and she said not really. Somehow I got approved for 5000 with no interest for 2 years, which surprised me. You could buy alot of appliances for 5000, lol. Houses in my neighborhood have been selling well, too. I agree it sounds like a hoax. "Make me the president and this 'financial emergency"(insert B.S. propoganda here), will be done!" Of course it will, it's easy to fix a problem that doesn't exist.

 

[Patman]

I see things snugging up on some business loans but those a re generally leaving the bank in a bit of a risky situation because the people involved can still go on living their happy and opulent life style if they pull the plug on the business and leave the bank holding the bag. I think there will be some trickle down effect as well but it's not a bad thing when you are told you can't afford to take out a loan on something you can't afford in the first place.

 

[whenfoxforks-ruled]

Big Business's are another story. They truly do have issues getting funds and what not. But, thats what happens in business adventures, some open and some close. The mess on wall street, screw them, let them take care of their own mess. They started it and they can finish it. They did a good job of recovering from the biggest drop ever? Without the piece of paper to erase wall streets problems yet! Now split that bail out amount between every citizen over 18 and see what around 450,000 dollars each does for our economy for real! Even with the half off the top going straight back to good old Uncle Sam. Really if they wanted to, erase the debt. I would bet whoever we owe could sure use their money! Imagine what all that cash would do to the economy!

 

[Ol'89r]

it's not a bad thing when you are told you can't afford to take out a loan on something you can't afford in the first place.

BINGO! :cool: Patty nails it. :nod:

The new loans will require some equity and a down payment. Not a thing wrong with that unless you were planning on bailing on your loan in the first place.

The media is a BIG part of the problem. They spoon feed us what they want us to hear and unfortunatly, most people believe it.

This whole bail-out thing is such a cluster#@&^ and it is only the beginning. If you think $800 billion is going to fix the problem, I've got some ocean front property in Arizona I would like to sell you. In a couple months or less, they will be back for more. Most likely sooner.

Bend over America. The shaft is coming. :uh:

In all of my years living in this country, I have never been more ashamed of my political leaders. :|

 

[KTM Mike]

In all of my years living in this country, I have never been more ashamed of my political leaders. :|

Boy isnt that the truth!

The credit crunch is real - it just wont hit everyone, or if it hits, it might not be obvious. Chrysler stopped offering leases - that is real and big. Those with good solid credit histories, making decent downpayments, and that can afford to finance over shorter terms wont likely find much different. Those with poor credit, low down, or wanting a real long loan term are more likely to either be turned down, or flat wont be offered the "favorable" terms many have come to expect in recent years. To me it seems I hear fewer of the "troubled credit", "we finance anyone" "no money down" sort of offers. Local news reports have mentioned car dealers finding some potential buyers being turned down for financing. I recently spoke to a local dealer who mentioned sales are down signficantly. A buddy of mine that runs a small scale used motorcycle dealership - who had a banner year (fuel efficient street bikes) this year, was unable to get financing for some improvements and expansion plans.

Both predatory lending practices, and consumers all to willing to take advantage of rather inappropriate loan terms, or flat out borrowing to much are both to blame. I have little sympathy for lenders who made bad lending decisions - likewise, I have little sympathy for people who decided to go buy the new house that was $100,000 more than they should of spent simply because they had a lender qualify them for some "jumbo" loan.

It is a f'ed up mess - and while I agree something HAD to be done, I am not so sure the bail out bill was the right something. I make my payments on time, am not in excessive debt, yet am paying for the stupid decisions of others, and in many cases, others who likely have annual incomes 5 times (or more) than what I do. I dont like regulation for regulations sake - but this is a case where the lack of our "leaders" being willing to do their job means we all pay.

 

[2strokerfun]

When I saw people that were probably making a lot less than I buying houses two or three time what I own, I wondered what would happen with all those "interest only" home loans once the balloon payment was due. I still expect to see a whole bunch of $500,000 homes vacant in the next year or two.

 

[Patman]

2strokerfun you'll see a bunch if it ends up anything like the ARM loan debackle of the early 90's. We had bought our first home when everybody was pushing those adjustable rate loans and said "NOOOOOO WAY! We'll go with a fixed rate thank you very much." and of course it was pointed out we qualified for a lot more house and if we did the ARM gig it would be every more. Come about 5 years after we had that first house built in a new neighborhood with all new houses around us and almost over night it was a ghost town! On our street alone out of 2 dozen houses I bet 50% were FHA forclosures.

 

[CR Swade]

yup, its real...the last 2 pools I have sold were unable to finance at all through their regular banks. On Labor Day, my bank called and informed me they are frozen up on commercial lending and no loans goign out right now unless you have the cash in CD's to back the loan. 50K line of credit now requires 40-50K in CD's or cash.

This one is real unfortunately...well IMO I would rather have had this thing play itself out and let the bogus mortgages, shady lenders, strung out businesses all twist in the wind and deal the repercussions that free enterprise had in store for them. Now with this stupid bailout, free enterprise is a myth. Small businesses like me NEED free enterprise to happen, not bailouts.

Consumer credit is very much going to get tougher to get...the real storm hasn't hit yet. Once commercial credit continues to squeeze business and their operating capital, you will see more of what this storm has in store for us. If you must live with t he notion this is a media created hype and feel the need to keep financing, you are going to get bit. For the next several years, cash is and will be king. The good news is all sorts of property and toys will be dirt, and I mean dirt cheap next year.

 

[XRpredator]

Wade, you might be right that "Cash is King", but they are now printing up new $1 bills:

 

[_JOE_]

Hey Pred, that dollar bill kinda looks like it came from the plus size strip club. :)

 

[whenfoxforks-ruled]

Hey Pred, that dollar bill kinda looks like it came from the plus size strip club. :)

That reminds me, since the local krispy kremes folded up, I may have to find a new calendar source. Thanks Joe!