How to Rebuild After Losing Your Fortune

Reader Comments
Back to blog

I think thus is a very true article I am looking forward to reading the book
We have three kids and had to sell our home and are now renting. We didn't go bankrupt we just have very bad credit. We were making a 6 digit income and list everything we are both working and my husband is working 18 hours a day. It's too bad the people had to pay for the mistakes of the wealthy

Leigh Ann 12:48PM March 29, 2012

puke gag and hurl make me want to do the same with their self righteousness. No one in the real estate business expected what happened and because Mr. Frank and others in the fed govt allowed mortgages to be sold and packaged as securities is where the problem came in and everyone from the buyer to the seller, to the realtor to the lender got screwed and that is why fannie and freddie will be revamped next year. It is a problem with our govt and it was leading dems who allowed these things to happen. No one who got a loan on their home thought they would lose it, IT COSTS TOO MUCH IN CASH AND HEARTACHE TO LOSE YOUR HOME AND YOUR BUSINESS. And the first person "Life comes for a fee", you dont even make sense, I dont even know what you were trying to say. When the government gets out of the banking business and the credit score people quit getting their kickbacks and lending goes back to who you know, who you go to church with, who you have done business with like in the old days before credit scores, then we wont have a problem like this again and it is the only way it will work. Anything that Mr. Baum or any of the other professionals made as their living took alot of blood sweat and tears to get there and to become successful. A lot of brains and alot of time and alot of ignorant people to wade through like puke, hurl, or maybe you work for a union or are one on the government dole. Something like that. You certainly do not have any real world experience or education.

Lisa of FL 7:52PM September 15, 2010

Life is all about who gets who and who gets what...for as long as one can manage to carry own at whomsoever cost doesn't matter....for as long as one can live in feastful life be it for the time being or forever....but karma gets in! Life comes for a fee!!!

Marissa of NY 1:24PM July 23, 2010

If you used a mortgage broker, such as Mr. Daum here. They are experts; experts in being pigs at an endless trough! There is truly, enough blame to go around for every party involved in the real esate transactions that were the bomb, not the fuse, that collapsed the economy. However, the feeding frenzy started with wholesale mortgage brokers. Who sold loans to lenders above PAR pricing to obtain the largest rebate, yield spread, KICKBACK from the lender. A lot of borrowers could have qualified for lower rates, a more favorable program, but their "trusty" mortgage broker, went for the biggest money they could get at the close. They submitted these loans to the lender with loosest underwriting criteria, highest rebate pricing they could obtain, told appraisers what the value needed to be to make the deal work, pushed for credit exceptions, screwed the borrowers from the front with orgination, garbage fees, and then screwed them from the back with a higher interest rate, (yield to the lender) paid by the lender to the broker. Then churned and burned them again within a few months. I audited final HUDI's and was horrified at the rebates these pigs collected, along with their garbage upfront. With automated underwriting, no doc loans, a five min phone call to order an appraisal, what did they do to earn the thousands, in Mr. Daum's case, millions he earned? I would love to see the final HUDs on his million dollar mortgage broker business. Tell me, Mr. Daum; how much rebate pricing did you collect, or credit to your borrower's closing costs, did your borrowers qualify for a more, borrower friendly loan? You're a hack! It's people like you that have turned the mortgage industry and those of us left to pick up your crap, into a shameful, dishonorable career. And you inked yourself? Why not really, do something for people. Write a confessional, tell all about mortgage brokers, net branching, mortgage brokers converting to mortgage banks to keep themselves from RESPA reform. Hemlock Soup for the Mortgage Brokers Soul. That would probably be a best seller. Of course, you might have to leave New York and go into hiding.

H. Pruett of CA 9:40PM July 15, 2010

It was not my contract, it was the lenders.
If anyone was an expert in evaluating the real market it would have been the lender.
It was their appraisal that said the house was worth 10% more than the loan.
I am simply exercising an option in the binding contract.
Business is business, sorry.

Steve of FL 2:13PM July 15, 2010

That is some inspirational stuff. Thanks for all the enthusiasm to offer such helpful information here.

filmy porno of AL 5:02AM July 12, 2010

Most office workers today do the work of two or even three people for the wages of one. This is virtual serfdom.
To those who, with malice or not, are advising the rest of us how to manage our money.. Do you have a car payment? Have you ever had a car payment? Then shut up. Do you have or did you ever have a credit card? Then shut up.
You've no right to advise anyone about anything.
This isn't about right or wrong. Was it wise for Americans to allow themselves to get into so much debt? No. But when the opportunity to own a home for people who've never had that opportunity presents itself, who can blame them for jumping at it? Who can blame the guy driving a beat up, 8 or 10 year old car, from leasing a new car for $200 a month? Who can blame a family with a 19" tv set from buying a big 40" LCD with that shiny new credit card they just got in the mail. Advertisers know that most Americans aren't going to concern themselves with the 18% or higher interest rate on the card as long as it only shows up as one "small" monthly payment. They aren't going to realize that that $10,000 car is actually costing a lot more over 5 years.
And our government actually allows them to charge up to 30% interest!! Even the Mafia isn't that bad!! This is pure piracy!!
It wasn't Americans overusing credit cards or living outside of their means that caused this economic calamity which has struck so many of us. It was the bankers and mortgage brokers who, knowingly, falsified financial statements, wrote bogus mortgages, and broke many fair business practices and financial laws while fleecing the American public, foreign investors, and their own companies.
And when the bubble finally burst and they were floundering in a morass of their own making, they cried to the government "Save us!" And foolishly, we did.
So, now, after all that..have they learned anything? No. Those morons are still basing our so-called "recovery" on consumer spending!! Americans are buying stuff again, all is right with the world. I'm still getting applications for credit cards in the mail daily, Capital One has those cute barbarians telling you to spend, spend, spend.!!
How many of those rich, *(&*^%$% bankers lost one single penny in this crash!!???? How many....ZERO!! They lost nothing because our nation bailed them out with our money. Sure, they were able to come back and pay it back, but who's going to pay for putting millions of us out of work? Who's going to pay for me having to short sell my house? Who's going to return my retirement money to me and you?
This isn't about Mr. and Mrs. America making bad financial choices..this is about making Americans producers again and not just consumers.

Rick S of FL 9:56PM June 03, 2010

It's not all the companies' fault either. Emissions standards, government regulation, demands for higher wages all contributed to moving jobs overseas.
But the United States was, at the time, the largest market for goods in the world. But we were in financial straights in the 80's, prior to the Reagan "boom" which was based on borrowed funds from the Swiss, resulting in the recession Bush had to pay for. But that's another argument.
This was the period of the electronic boom, the period of the computer, cellphone, wide screen tv, high end stereo, cd's, dvd's, ..every electronic device you can dream up. But most Americans would not have been able to buy those things if there was no credit. So, suddenly, people who could never get accepted for a credit card were given $10,000, $20,000, or even more in credit. And lo and behold. the more you used it, the more they gave you. It was free money....at 18% interest or more if you were considered a poor risk.
You no longer had to earn $50,000 or more a year to get a credit card. Any job lasting more than a couple of months qualified you. These greedy so and so's gave credit to people who, for the most part, were completely ill-equipped to deal with it responsibly. I'm not an elitist, but there was a reason credit cards were only given to people with high incomes, one, they could pay them, two, people with those kind of incomes generally are pretty good at managing money.
The fault for this debacle doesn't fall on the shoulders of those who just played the money game the way they were taught to play it. It falls on the shoulders of the greedy bankers and mortgage brokers who wrote mortgages that they knew were going to default, and then sold them. Then some other company packaged all these worthless debts into a pile and called them securities. Talk about Newspeak!! There was nothing secure about these things.
The practice of selling mortgages after they were written is what basically caused this problem. If the companies that wrote these sub-prime mortgages for low income people with little hope of repaying them had to actually KEEP that mortgage and suffer the financial loss when it defaulted, most of the mortgages wouldn't have been written, there wouldn't have been bogus "securities" and the housing market wouldn't have crashed.
And yet, this practice continues. We haven't learned a thing from the crash. We are still gauging the success of the "recovery" based on how much we spend!!! Millions of Americans have lost homes, jobs, and cars and you morons worry about how much we're spending!!! Base the damn economy on something worthwhile...like how much were PRODUCING!! America can no longer be the consumers of the world's cheap crap! You took our jobs, left us as white collar slaves, forced to work far more than the 40 hours we used to, with little compensation other than "comp time" which, if we take it, can cost our job.

RickS of FL 9:35PM June 03, 2010

It's arrogant and self-righteous to berate people who through absolutely no fault of their own ended up in financial difficulty. To tell Americans in the 21st Century to "live within their means" when we've had credit shoved up our collective rear ends for more than 40 years is ludicrous. If all Americans lived within their means, and never used credit, there would be no automobile industry, or new homes built. Most electronic firms would be out of business and our economy would collapse much worse than it is now.
How many of you can afford to shell out $15,000 for a car. or say even half that for a decent used car? Nobody can drop $100,000 for a house, and that's a very small amount.
I grew up in the period where credit cards were becoming commonplace. Today's VISA was once called BankAmericard. It was the only credit card you could get if you weren't rich. Prior to that, you had American Express, Diner's Club and Carte Blanche. All of these were symbols of wealth and status.
Even so, in the 60's, you still had to have an income in the high 40's to mid $50,000 range to get a BankAmericard. This basically continued well into the late 70's. Cars, even in the middle 70's were generally under $5000, and homes in the $20-50,000 range. Even so, $5,000 was an incredible amount of money when the minimum wage was $2.
It was in the 80's, when companies, now called multinational, decided to start closing shops here and sending their manufacturing overseas, killing a lot of American jobs, and leaving many Americans with no income. High end manufacturing jobs in auto plants paid upwards of $60/hr with incredible benefits, thanks to unions and years of collective bargaining. Even a decent factory job paid $15-20/hr. Companies found they could cut costs immensely by using 3d world labor at 1/10 the cost of Americans. However, they still needed us to buy their products. Enter...free credit. Suddenly in the late 80's, everyone had access to credit cards. All you needed was a job and a minimal income and you could get up to $10,000, 20,000 and even higher amounts in credit at 18% interest. Suddenly, for many cash strapped Americans, we were able to afford computers, wide screen tv's (which before were limited to the wealthy or upper middle class) and many more "luxuries" which we were told were our right as Americans to own. Make no mistake about it. We were programmed daily, bombarded with advertising in every direction at all hours of the day and night, telling us to buy, buy, buy. Use your credit card for everything.

RickS of FL 9:16PM June 03, 2010

FROM CHILDHOOD HOOD, DIFFERENT PEOPLE LEARN IN DIFFERENT WAYS BECAUSE THEY ARE TAUGHT THAT WAY. NO ONE CAN SAY THEY HAVE NEVER MADE MISTAKES WITH MONEY. WE ALL HAVE SPENT AND SPLURGED WHEN IT WAS NOT THE RIGHT TIME. WHATS YOUR MONEY BLUEPRINT? YOU HAVE STARTED IT FROM CHILDHOOD. YOU WERE TAUGHT IN A CERTAIN BELIEF STRUCTURE. IT STARTS FROM WHOEVER EVER YOUR MENTORS WERE GROWING UP. THE WAY YOU WERE RAISED. ALSO LOOK AT HOW MANY TIMES YOUR MIND IS CONTROLLED THRU TV AND RADIO. THERE ARE ALOT OF REASONS PEOPLE DO WHAT THEY DO. YOU ARE FIGHTING THINGS INSIDE YOUR SELF THAT YOU HAVE BEEN PROGRAMED TO BELIEVE. THINGS THAT YOU DONT BEGIN TO UNDERSTAND UNTIL YOU HAVE GROWN UP WHILE MAKING MISTAKES. BE THANKFUL FOR WHERE YOU ARE IN YOUR LIFE. JUST REMEMBER! YOU CREATE YOUR OWN LIFE. IF YOU WANT MORE, YOU HAFT TO HANDLE WHAT YOU HAVE BEFORE YOU CAN HAVE MORE. WE HAFT TO LEARN TO BE CREATIVE IN OUR OWN UNIQUE WAY. IF YOU HAVE AN IDEA, WRITE IT DOWN. THEN FOLLOW THRU ON YOUR IT. ASK QUESTIONS, GET HELP. NEVER BE TO SCARED TO SEEK GOOD INSIGHT. THIS IS A GOOD LEARNING EXPERIENCE FOR THIS COUPLE. THEY WILL BE SUCCESSFUL AGAIN. NEXT TIME AROUND THEY WILL ELIMINATE ALOT OF THEIR MISTAKES. CHALLENGE IS WHAT FUELS US. WHERE ELSE OTHER THAN THE LAND OF OPPORTUNITY CAN YOU DO THAT. THEN COME BACK, MAYBE EVEN BIGGER AND BETTER THAN THE LAST TIME. I DONT KNOW ABOUT THE TATT ON THE CHEST THING, BUT WHATEVER WORKS FOR YOU.... WITHIN THE LAW WITH OUT BREAKING IT.

STEVE of MI 5:36PM May 26, 2010