Read this - from a sob story on tony Rumson, NY - and tell me where the *analysis* falls flat:
"People don't have the money they used to have," says Richard "Ric" Martel Jr., a broker in the Rumson office of Prudential Zack Shore Properties. "The scenario could be a banker who was making $1.5 million, and now their company went under -- like Lehman Brothers or Bear Stearns -- or they have seen their comp cut to $750,000, and the house they bought in 2005 for $1.6 million is now worth $1.1 million, and . . . the mortgage is $1.280 million."First correct answer scores a n@ked C-Nut bobblehead doll...
Residents are "still owning nice cars and belonging to beach clubs and country clubs, and they're asking themselves, 'Where can I cut my monthly nut?' The answer is to put their home up for sale."
5 comments:
Not being a finance guy and all, just an ordinary working joe, all I see is that they are still buying cars that cost the same, instead of downsizing the car thingy.
It makes no sense to ditch a house that you would lose money on, how does that diminish the monthly NUT?
(Please let me be wrong....)
put house for sale? only person gaining from that would be realtor, getting his commission.
just walk away...if need a house desperately then maybe sign up for another house @ foreclosure deal, before foreclosing on existing house.
if you dont have morals(or want to be realist), just stick around in the same house without paying mortage for 1 year or how-ever-time the bank allows without evacuating you.
may be this is what everybody is doing. else they would be ideological idiots.
* mortgages are 30% or more of current home values
* because of above reason, they cant refinance to get current historic low rates
it's NJ, not NY
your cuz
Some good points there but the trenchant one remains unmade.
cuz,
Rumson is indeed in NJ and on a map doesn't exactly like a typical Manhattan commute.
But it's on the water and I believe has a *quick* ferry that goes right to Lower Manhattan - where Bear Stearns, Merrill, Lehman, Goldman, etc. have offices.
This afternoon I'll reveal the answer I'm looking for. Meanwhile I'll hold on to the doll and....play with myself.
Alright, here's the answer I was looking for, the biggest hole in that ANALysis:
The broker laments that these guys/gals are only making a mere 750k a year now.
Okay. But that's still over 36k a month in after-tax pay (assuming a 50% tax rate).
A $1.2 million mortgage is nothing at all with that kind of income....requiring only a 7-9k monthly nut!
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