So my wife and I have started the process of house shopping. We’ve got a conditional pre-qualification for $250k from one lender but there are a lot of people telling me that I should look at other sources because that lender is selling off their loans as soon as they make them. I’ll probably check in with our bank and see what they can do for us. We haven’t always had a lot of money in the accounts but we’ve been a customer for quite a long time now so there’s some history there. Maybe they can give us a good deal.
My wife remarked yesterday that if I could I’d remove all the credit cards and all the loans and all the other financing stuff from society if I could.
Y’know what? She’s absolutely right.
About the only thing I might leave financing for would be homes and emergencies. A car should never have to be financed - they should be cheap enough to buy directly. Hardship loans should require you to show actual hardship.
And IF you didn’t have any financing to deal with, in most cases, you’d be able to save more money and then have money to spend on a car or a plane or a trip or anything. And if you don’t have that financing available then you’re less likely to put yourself into a situation that will leave you stuck.
Can’t buy that neat cool toy? Tough. Save up your cash. I’m a little biased on this subject because I didn’t grow up with all that much. My family always had some sort of food on the table and a roof over our heads but I didn’t start getting a lot of toys and stuff until I was much older. (This partly explains why it’s so hard for me to get rid of things. I grew up without a lot of things so anything I get now I want to keep - just in case I can’t get another one.)
I’m sure if my mother is reading this she’s asking “Then why did you destroy all your Matchbox cars?”. The truth of that is that I just didn’t know any better at the time. ;-)
But I digress...
Right now my gut feeling is that at least 50% of the US population is in debt and in trouble in some way. (That 50% may even be a conservative estimate.) The other 50% either have no debt or are properly managing their debt. (Please note that these figures come from the nether regions of my posterior. I could take time to do the research but even if it were only 30% of the US population it would be too high in my opinion.)
Between predatory loans, blatant usury, identity theft, and other such things credit is rapidly becoming a serious issue and a _liability_ to most people. But is it required to live in our society? In my opinion - no.
If all credit except home loans and hardship loans disappeared right now. I mean right this instant banks and credit card companies stopped issuing credit loans for anything other than mortgage and hardship loans. The country would be in a hell of a state! It would be all fucked up.
And why is that? Because we as people let companies who lend us money decide how our lives will be lived.
There are terms in credit card agreements that make my blood boil. For instance in many agreements if you miss one payment WITH A DIFFERENT LENDER THAN THE ONE YOU HAVE THE ACCOUNT WITH your interest rate on that account can be jacked up to the maximum APR without even telling you. That means that if the mail loses one envelope, if the website loses one transaction, if the clerk at the currency exchange drops your payment into the trash can because they don’t like the look of your face, if even ONE THING causes that ONE PAYMENT to be missed, then any credit agreement that has the above clause in it will suddenly skyrocket your payments beyond what you can afford.
So if you have multiple credit agreements and miss even one payment you can be potentially put far enough behind to put you out on the street in short order.
Does anybody out there really think that’s a good way to live? Anybody?