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Michelle Singletary
Washington Post Columnist
Thursday, July 2, 2009; 12:00 PM

Personal finance columnist Michelle Singletary hosted an online discussion with Edmond L. Andrews author of "Busted: Life Inside the Great Mortgage Meltdown" on Thursday, July 2 at Noon ET.

This Story

In her June 7 column Michelle writes that this controversial book is "the story of how a well-educated, highly paid economics reporter for the New York Times, whose beat includes covering the Federal Reserve, ended up with almost a half-million-dollar mortgage that he and his wife, Patty, couldn't afford." Read more in "Busted: Life Inside the Great Mortgage Meltdown"(W.W. Norton, $25.95).

A transcript follows.

Read Michelle's past Color of Money columns or check out her past Book Club picks.

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Michelle Singletary: Welcome everyone. Sure this will be a great chat with lots of good (and decent) comments and questions. So let's get started.

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Richmond, Va.: My mother recently died and my sister and I are trying to keep up her mortgage until we can sell her house.

We are waiting to get some money from selling some of my mother's stocks but it is taking a lot longer than we thought. We missed June's mortgage and may miss July's.

Our banker says that we should borrow from our lowest interest credit card to pay the mortgage, rather than take from our own IRAs (we both are over 60) since its likely the house will sell in the next couple of months and we won't have to use our own money that way.

This doesn't seem right but what do you think?

Also, do you think we should call the mortgage lender and say we aren't deadbeats and intend to pay or won't that stop threats of, or actual foreclosure?

Thank you.

Michelle Singletary: You need a new banker, the idiot!

Do not borrow against your credit cards.

Yes, call the bank. Explain the situation and see if you can get some time to pay the mortgage while you settle your mother's estate.

But if you borrow against your credit card and you can't get the house sold and you can't pay that money you get stuck with the bad credit and increase in your personal debt (which lowers your credit scores).

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St. Pete, Fla.: Michelle, I recently heard Ed & Patty Andrews acknowledge in an interview that their likely path, going forward, will be to find a rental residence for their family - a choice they originally decided against, as Ed chronicles in his book. In your view, does renting seem to be an increasing, near-term consequence for America as a whole? E.g. over the last few decades, younger & younger marrieds have operated under the assumption that owning should come early in their lives. Today, it seems many realize renting needs to be the near-term choice with saving for a down payment to be preferred over no-down loan gymnastics.

Jack

Michelle Singletary: Good questions. I've always thought people should rent until they could "afford" to buy. But in the last several years people "heard" that if they didn't own a home they were financial failures. Not true at all.

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Burke, Va.: Mr. Andrews, I haven't yet read your book, but definitely plan to. I'm wondering if your wife's name is/was on your mortgage? My husband and I took desperate steps to avoid bankruptcy 10 years ago after our daughter died of leukemia, because we thought declaring bankruptcy would ruin our finances forever. If your wife could still get a mortgage after having declared bankruptcy twice, I'm wondering if we made the right decision.

Edmund L. Andrews: My guess is you did the right thing in trying to avert bankruptcy any way possible. You are correct that my wife did have to file for bankruptcy in 2007, not because of our mortgage but because she had run up debts to her own sister while living in Los Angeles and grappling with a deadbeat dad.

But my wife wasn't a borrower on any of the mortgages, so her financial problems had no bearing on our ability to borrow.

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Atlanta: re: your shoes column.

Don't get shoes that pinch your feet. Take care of your feet!

I used to buy shoes that don't fit (I'm a wide, stores don't carry that). And so I would keep going and buying shoes - and I'd go to the stores, and the cute little shoes would be on sale, so I'd buy more than I had anticipated. Then I'd go shopping more, cause the shoes I had hurt, so I wanted shoes that didn't hurt.

I didn't realize this until I actually started buying shoes that fit. I buy online now. I buy only shoes in my size. I pay a lot more for shoes (not $700, more like $75-100), but I don't buy as many, because they fit properly! So I save a ton of money on shoes (I also only buy what I'm looking for, I search for them, so I never even see all the other shoes for sale).

Just saying...it will cost you more in hurt feet (that matters, right?) and it might cost you more because you may need an expensive surgery on your feet if you don't wear the correctly sized shoes.

washingtonpost.com: If the Shoe Fits

Michelle Singletary: Thanks for the advice but I think you misread my e-letter or I wasn't clear. I buy shoes that DON"T hurt my dogs. And many of them are UGLY!

But I don't care. I hate for my feet to hurt. But you know women really will comment on your shoes. I was out eating after church one Sunday with my ugly but comfortable cheap shoes and two well-meaning and sweet women said: "Yup, you are true to your word as they looked down at my feet."

But guess what? I don't have corns on every toe and this is still with buying Payless shoes!

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Indianapolis, Ind.: Not much has been discussed about the mortgage meltdown about the real problem which was the fact that the valuation of real estate had outpaced income for many years and this pattern could not extend forever.

I recall my friends telling me that I had the real estate valuation incorrect and that I should always accept the asking price on a home or within a few dollars of that amount. I would tell them that the valuation wasn't based on reality and that I would never tender an offer on a house that I thought was overpriced. I wish someone besides myself would have taken this approach and we might have not found ourselves in this mess.

Also, please comment on the fact that real estate agents perpetuate this unrealistic real estate valuation since their income is based upon that valuation and the more value they get the buyer to pay, the more money for them. I think the real estate community also contributed to the real estate problem. They forced the buyers to think that the houses were worth the unrealistic valuation.

Hope you can comment on these causes that are seldom discussed in the press.

Michelle Singletary: There has been stuff written on the cost of homes outpacing people's income. But your point is well taken. The average income-earning family in this country is having, had and will have a hard time "affording" a home.

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Sterling, Va.: What has been done by Congress to stop the predatory lending practices and misleading real estate sales tactics? They seem to be focused on pushing through more regulations against financial advisors and mutual fund companies. It amazes me some of the stuff that mortgage and real estate brokers still get away with to this day. I have a MBA with a concentration in finance and just bought my first home a few months ago. I was shocked at how complicated and confusing buying a home can be. Every aspect of the home-buying process works against the consumer. I guess this is the evil side of unregulated capitalism.

Michelle Singletary: You are so right. I mean I've bought three homes and each time I caught something wrong or had to fight to get the right stuff, price, cut of crazy closing costs, etc.

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Silver Spring, Md.: We owe $1,400 on a credit card - the last of our debt besides the mortgage. We have $9,400 in a money market fund (our emergency savings) plus about $2,000 in the life-happens fund. I think we should pay off the credit card with money from the money market fund then increase our monthly contribution from $100 to $200 to build it back up. I mean the interest rate on the credit card is 10% vs 1%. I hesitate because it's taken so long to get the emergency fund up this high but on the other hand I hate to pay all that interest (and have the possibility of the interest rate going up as some credit companies are doing). Please give me the kick in the behind to pay off the cc and rebuild the money market fund!

Michelle Singletary: Consider this your KICK IN THE BUTT.

Pay off the credit card!

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Reston, Va.: I haven't read the book, but I could probably write my story and it would be almost the same.

Edmund L. Andrews:

I have gotten hundreds of letters from people who either made bad decisions or had bad luck, and who could relate to one part or another of our story.

Everybody has a different reason for getting in over their heads on debt. What my own case shows is that it can happen to people with good educations, good jobs and even knowledge about the mortgage business. Patty and I let our emotions overwhelm our rational sides in an unusually spectacular way. But it happens in smaller ways all the time -- the family that "must'' put their child into a private school, or be in a neighborhood with famously good public schools.

I've been surprised at how many distressed borrowers come across as quite earnest, and ashamed of their own mistakes.

There are always people who get carried away and make mistakes. What made this broader crisis so unusual is that it swept up millions of people at the same time.

That's not just about human nature. That's about banks and mortgage lenders determined to loan money to anyone who can breathe.

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Wheaton, Md.:I think the basic problem is the sense of entitlement that people have. If you're college educated,(and even if you aren't) white collar, middle class or above, the thought is that you DESERVE to treat yourself, even if you don't have the income to pay. I have a friend whose husband left 9 months ago. Support is sporadic, he took the tax refund (she was supposed to get it), but she still spends like he is living in the house. She buys processed convenience food for the kids ("They like them"), and still gets manicures and pedicures. She's not working and keeps putting off doing so. I finally had to resolve myself that she'll be in her mother's basement within a year, as my advice to buy whole foods, take a part time job doing anything and not see every kids' blockbuster movie have fallen on deaf ears. She can't seem to see herself as non-middle class, while she teeters on the edge of disaster. She and her kids deserve to live as they always have, regardless of her finances. I've given up trying to help.

washingtonpost.com: Jackson's Money Woes Can Teach Us About the Dangers of Entitlement

Michelle Singletary: You sound like a good friend. But step back a bit and perhaps don't be too judgmental. It's hard after this kind of event in your life to change the way you spend. You are ABSOLUTELY right that she has to change her spending. But she's probably hurting and trying to prevent the kids from hurting by continuing the life they had.

I've worked with many women in this situation. I talk to them, pray with them, counsel them much like you are. So be kind AND give her the info straight up. But always remember it's hard to be walked out on and then realize you have to go back so far financially.

Just be there when she falls with a hug and any help you can offer.

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Rockville: So has the book helped out financially? I hope it is at least a silver lining to the financial mess. I also have to say that it was very smart to write the book.

Edmund L. Andrews: The book has brought me a little money, beyond what it cost me in terms of lost salary (I had to take five months off from work without pay).

I'd love to make money on the book, but I wrote it mainly because I thought I had a valuable window on the broader mortgage meltdown.

Michelle Singletary: Also remember with books deals there are agent fees and taxes, etc.

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But guess what? I don't have corns on every toe and this is still with buying Payless shoes!: That's great, but those of us who can't find shoes to fit at Payless are stuck with catalogues and high prices.

But I love your advice in general, so keep up the good work.

Michelle Singletary: Okay. My daughter has big feet so I'm with you sister!

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Encino, California: Most banks really do have a heart. They would understand the need for an estate to be settled. And might even allow a minimum payment per month until the house is sold. But the sisters won't know the bank's answer, if they don't ask their question first.

Edmund L. Andrews: I agree. I am in discussions right now with JP Morgan Chase, my primary lender. They have made an offer to refinance my loan at a rate that would top out at 5.5 percent.

I don't think we can manage with that, so I am asking them to consider reducing the principle amount of the loan. Banks hate to do this, but they also want to avoid foreclosure, which can cost a lot more.

I don't know how this will work out for us. But if you're in a jam, there's nothing to lose in trying to negotiate.

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Washington, D.C.: I just found four transactions on my VISA debit card account that I didn't make. I contacted my bank to close the account and the retailers to dispute the charges (my bank said they couldn't do anything until the charge actually posted--right now they are just pending).

Is there anything else I should do? How does this happen? I still have my card, so just the number and my name were stolen...

Michelle Singletary: Just stay on top of this. This unfortunately happens often. But so far you have taken the right step.

And I would keep a keen eye on all my credit card statements in the future.

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Arlington, Va.: Hello!

Basic question about the "life happens" fund -- should I include bigger purchases like saving for a car and re-roofing in this account?

Thank you so much for your chats.

Edmund L. Andrews: I've been thinking about this very issue, as I discuss with my lender what kind of a mortgage we can realistically afford.

I've tried to estimate an average monthly budget for home repairs, based on those rare-but-expensive home repairs we've had over the past four years. I figured about $200 a month, though that may be low.

Michelle Singletary: Yes, you can save for such things in the life happens fund. That's what I do.

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Greenbelt, Md.: Mr. Andrews, so now that you have a best-selling book, are your financial woes behind you?

Edmund L. Andrews: I wish. The only way our problems will be resolved is probably by giving up the house and renting a place that is much cheaper.

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Los Angeles, Calif.: Michelle, What do you think of there being a nationwide housing boot camp for high school juniors/seniors. Even if it's just a one week introduction to introduce them to the rights and responsibilities of being a renter vs. a homeowner?

Michelle Singletary: Not a bad idea but I would require the parents to attend too.

The thing is good financial education should start in the home. It's how it will stick.

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Los Angeles: As I emptied out our bank account to pay rent yesterday, I suddenly realized that my husband and I are the working poor. I've always thought of myself as middle class but with virtually no assets, a 10-month old baby, $2.77 in savings, about $120,000 in student loan debt, and about $50 to last until next payday, it hit me: we're not making it.

We don't spend extravagantly - in fact haven't spent money on anything but gas, food and basic household bills in months (no cable, internet or other extras). We have no credit card debt. Yet I've actually been skipping meals to save money. Yes, we live in an expensive city, but this is home. We both have jobs with benefits so packing up and leaving to a place where rent is cheaper is not an option with the job market being what it is right now.

Since this realization yesterday morning, I can't help but think that it was painfully short-sighted to bring a child into this situation. I love my daughter more than I can express and she's a happy, healthy, thriving little girl, thank God, but what have I brought her into? We weren't struggling like this when we got pregnant. What are we doing wrong? Forget about saving, how can we at least get to the point where we have enough money for food every month?

Michelle Singletary: And yet you gloss over that $120,000 in student loan debt!

Go back and really look at your budget. I can not tell you how many people tell me just what you just told me -- that there's nothing to cut. In 99.0 percent of the cases there is something to cut.

You might also have to cut back on your retirement savings (just for a while) to find some more cash if you are truly at bare bones.

One thing. Don't skip meals. It's not healthy. You need to be strong for your child.

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New Haven, Conn.: Does Mr. Andrews regret exposing his financial decisions to the world this way? Would he make the same choice again? It seems like so many people have opinions on how other people live their lives and can get very abusive. I wish him luck and hope he's had some benefit from this ordeal.

Edmund L. Andrews: No regrets. I wouldn't recommend that others publicize their mistakes, but I do think people should be much more open about the stresses they are under. Many completely decent people have problems, and it helps to be able to talk them over with others.

Closeting yourself off from the world, keeping up a facade when you feel miserable inside, is not a good way of coping.

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RE: Wheaton's Friend: Hi, Michelle. THANKS for the advice to reserve judgment during a tough time. Went through the same thing. It's been tough, but my child and I are doing great, emotionally AND financially.

A comment on a common thread, though, with Mr. Andrews and Wheaton's friend. "Deadbeat" parents. Now THERE'S where I think we have an obligation to heap scorn, as well as better legislation to help. I serve on a homeless shelter board, and the number of people (mostly women, but not all) who lost their overpriced homes after a divorce and failure of the ex-spouse to pay support is truly heartbreaking.

Michelle Singletary: Thanks. And you know maybe there's more we can do to figure out why dads don't pay (and some moms). I think it's better to approach it this way otherwise they will continue to be deadbeats.

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Manassas, Va.: Hi Michelle, I am angry with my current brokers, the big name one we have been with for over 30 years. My adviser did nothing to warn us of the looming financial meltdown but afterwards all he could say was I was "over exposed". I want to move, but to WHOM? I also have a 401K with my former government employer's broker and I'm not happy with them either. How does one go forward? We lost about 30% of our total portfolios.

Thanks. Mary

Michelle Singletary: Without more details I'm not sure what your broker means by the fact that you were overexposed. But NOBODY could have predicted what has/had happened. Even people with well diversified portfolios have experienced great losses.

Going forward, really look at your asset allocation. Perhaps you were invested too heavily in one asset class. But was that by choice or did your broker give you poor advice? If so, then yes look around for someone else. Ask friends to make a recommendation. You should also read my Sunday column. I'm picking a book that addresses asset allocation.

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Arlington, Va. : RE: I've always thought people should rent until they could "afford" to buy. But in the last several years people "heard" that if they didn't own a home they were financial failures.: That's so true. When I go visit extended family, I don't get the "when are you going to settle down, get married and have kids" talk, I get the "When are you going to buy a house -- it's the perfect time to buy" talk. They don't seem to understand that while I -might- be able to afford the mortgage payments, I'm not sure I could swing everything else that comes with it: utilities, taxes, upkeep, etc... Plus renting a few more years allows me to add to my down-payment savings.

Michelle Singletary: So when these people say what they say, tell them what you just told me. And then be confident that you know more about your finances and when the right time to buy is.

The right time to buy is ALWAYs when you can afford to buy and you have other things in place -- emergency fund, life happens fund, etc.

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Wheaton, Md.: I think the basic problem is the sense of entitlement that people have. If you're college educated, (and even if you aren't) white collar, middle class or above, the thought is that you DESERVE to treat yourself, even if you don't have the income to pay. I have a friend whose husband left 9 months ago. Support is sporadic, he took the tax refund (she was supposed to get it), but she still spends like he is living in the house. She buys processed convenience food for the kids ("They like them"), and still gets manicures and pedicures. She's not working and keeps putting off doing so. I finally had to resolve myself that she'll be in her mother's basement within a year, as my advice to buy whole foods, take a part time job doing anything and not see every kids' blockbuster movie have fallen on deaf ears. She can't seem to see herself as non-middle class, while she teeters on the edge of disaster. She and her kids deserve to live as they always have, regardless of her finances. I've given up trying to help.

Edmund L. Andrews: It's too easy to blame this on self-indulgent baby-boomers, or shallow and selfish people who grew up soft.

The lifestyle that Patty and I had was hardly glamorous. We've had almost no discretionary income for years now. We're living in a nice but very ordinary neighborhood -- no glamour. Our house is tiny, crowded and often run-down. The main reason we did it was for our kids, who have in fact benefitted from the neighborhood and the schools.

But I DO agree that many people, including us, often have an irrational assumption that life should continue unchanged even though they have made huge changes in their finances -- job change, divorce, or something else.

It is very, very hard to accept the reality that you have to change your lifestyle for the worse. And that was a very big problem for us, and I suspect many others.

Michelle Singletary: I know this a repeat of a question I answered but Ed's response is well worth printing.

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Columbia, Md.: Just a comment...I keep hearing about friends/coworkers buying short sales. While the prices of these properties may be great, these people still really cannot afford the properties (even at the reduced prices). Are we starting the whole cycle again?

Edmund L. Andrews: We could be starting the same cycle, but the big problem is loan modifications. A lot of lenders are offering modifications that don't really reduce a person's monthly payments -- sometimes, the payments are actually higher because of rolling in delinquent payments.

These re-fi's can temporarily solve a problem, but lead to new ones very quickly. That's what would happen if I took the offer my own bank is making to us right now.

It's not that the offer is worthless -- the loan would be fixed rate and better terms. but we still couldn't realistically afford it.

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Re: Pending Transactions: This happened to me as well, and I got the same response from the bank rep I spoke with. Fortunately, a few days later I received a call from my bank's fraud department informing me that there were fraudulent charges on my account. She was appalled when I told her that the rep had given me the "can't do anything about it because they're pending" answer.

Contact your bank and ask to speak with their fraud department ASAP. They'll take you more seriously than the rep did.

Michelle Singletary: Good advice thanks.

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Arlington, Va.: Mr. Andrews, I want to ask a very Michelle-like question: Did you and your second wife ever sit down and have a frank talk about money before getting married, discuss long-term goals, establish a budget, figure out how much house you could really afford given your alimony/child support payments? (If not, don't feel too bad- you are like most couples- but hopefully you will start having these discussions!)

Edmund L. Andrews: Yes and no. My wife knew what my take-home pay was, and what our mortgage would be. We did a back-of-the-envelope estimate that if my wife brought home net pay of about $2,500 a month, and her ex-husband paid his modest child support obligations, we could get by.

But all of our assumptions were wrong. Our monthly expenses beyond the mortgage were running above $2,500; it took my wife two years to earn a solid salary, and she lost that job a year later; and the ex-husband was always delinquent.

A budget would have helped. But the more basic mistake was to make assumptions about what Patty could earn, given that she was re-entering the job market after being a stay-at-home mom and that she was moving from LA to DC.

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Cardiff, U.K.: The social pressures to spend spend spend have been just the same here. My wife kept asking me what we were doing wrong having an older car than all of our friends. I insisted that they were buying on borrowed money. Now it turns out we were right. The biggest car was owned by a friend who was a regional manager for an estate agent (real estate agency). She doesn't have that BMW any more, or her job. We still have the ten year old car however.

Michelle Singletary: Well hello from the UK.

Love your comments. Proves that good basic money management -- live below your means -- is the same no matter where you live.

And for many it was hard to watch others appear as if they were successful and living large. Now we know they were living large with other people's money.

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Help in Md.: We are now WAY underwater -- about $100,000 according to some value generators -- and our 5-year interest-only ARM is going to end May 2010. We also have a $30K home equity loan through another bank, which we used to renovate our kitchen back when we were "above" water. Our mortgage company (not Fannie or Freddie, unfortunately) won't help since we ARE making payments and none of Obama's plans have been able to help us because my husband and I "make too much money" though we barely squeak by. Refinance companies won't touch us with a 10-foot pole thanks to the devaluation of the home. Other than walk away, what options do we have?

Michelle Singletary: Don't look at walking away as your first option.

Wait until your mortgage resets. Who knows it may reset to a reasonable rate since the index your ARM is probably tied to is WAY down thanks to the Federal Reserve.

If you find you can't pay the mortgage that is the time to talk to your lender about a deal.

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Rockville: "this is still with buying Payless shoes!"

My wife and I shop at Payless and have done so for 32 years.

Michelle Singletary: Like I always say why pay more when you can pay less.

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Washington, D.C.: I'm sorry, but some of us think we made good decisions. My wife and I rented until we'd saved up enough for a 20% down payment. Even after that, we still had a good amount of money saved. We bought a small house and a low mortgage payment (less than what we were paying in rent). After living there a few years, we had saved up a substantial amount of money (enough to pay off the mortgage plus still have a couple of years of living expenses if we both lost our jobs). We sold, at a profit (OK, so that was lucky) and bought a bigger house. We took all of our profit and used that for a down payment on the new house (despite the fact that the mortgage broker told us to only put the minimum down because we could invest all that extra money), making our new mortgage only a little more than the old one. In other words, we bought a new house knowing how much money we had.

Yes, bad luck happens. But people need to plan for it. And they don't.

And now, when I see people that bad mistakes (not the "my kid died of cancer" folks) are expecting sympathy and, in some cases, someone else to bail them out.

I don't feel like my good decision making and discipline has put me in a better position that those that make mistakes. Has it?

Michelle Singletary: You are kidding right?

You don't think you are in a better position than Ed and his wife or the hundreds of thousands of people who are losing their homes, lost their homes, facing divorce because of their money troubles, kids listening to heated and ugly arguments because they mad bad decision and people worried sick about their finances.

You don't feel better that you did the right by being in a good position amid all this chaos?

Put your hands together my friend and be thankful.

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Bonifay, Fla.: I'm much less interested in Andrews' financial status at the time, than whether it was portrayed accurately on his loan application. People go to Atlantic City and Vegas all the time. Someone might have (temporarily) withdrawn the value of a 401(k) retirement account to bet that Big Brown would "show" (3rd or better) in the Belmont. If the application was accurate, it does not sound like an AAA loan. Was it packaged as one? Unless this was an alt-A loan or sub-prime, fraud was committed. The culprit should either be forced to make the loan good or be jailed. However, note that I'm not saying Andrews is the culprit.

Edmund L. Andrews: I guarantee you that my mortgage application was accurate. I didn't fudge my income. I simply took out mortgages in which the lenders specifically did not ask to know about things. On my first mortgage, I literally did not disclose my income. It was a "no ratio" loan, meaning that the lender based the whole decision on the fact that I had a job, a good credit score, a house with an appraised value of almost $500,000 and a legitimate down payment.

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Wheaton, Md., again: Yes, I've been patient, I've listened and listened, but it's been almost a year now and she's showing no signs of cutting back on ANYTHING - the wine club, pedicures, Haagen-Dazs ice cream(sp),toys, scrapbooking supplies...

I guess I lost hope when she insulted my university and the state it's in (upper South)as I was bringing her groceries from my church's SHARE program - and she didn't even thank me for buying them. I guess I expected some gratitude, and didn't see any, just saw the premium ice cream she just bought. I'm donating what I would have given her to MANNA in MoCo.

Michelle Singletary: So as I said wait for her to fall. And then be there. Not with a told you so but with compassion.

Look I see this all the time. I work directly with folks who keep spending when they shouldn't. I fuss too. And I watch them continue to make mistakes. And finally when I realize they are hardheaded I just wait. Like my grandmother always said a hard head will make for a soft behind. Meaning they will fall and their behind will hurt.

And then I'm there to show them how to pick themselves up.

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Michelle convert!: Hi, Michelle--

I have been a lifelong saver, but your columns and chats have helped me realize there is still so much more I can do to cut back and live with what I need (plus a few wants!). I found a way to work that take, literally, just 5 minutes more but saves me from taking the Dulles Toll Road. I had colleagues who laughed at wanting to save what amounts to $50 each month, but that goes up when tolls double in January. I am putting half of that extra $100 in my IRA, half in my daughter's 529. Every bit helps, and making choices in one area motivates me to make them elsewhere :)

Michelle Singletary: Thank you. And you are right every bit helps. You can't have a dollar without a penny!

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Reston, Va.: Andrews and his wife did not "end up" with anything, and I can't believe the Post is promoting this ridiculous book. They made terrible choices. They chose to buy a single-family house they both knew they could not afford the mortgage on, instead of a modest townhouse or condo. She chose not to work and yet to continue to spend money in an extravagant fashion, instead of going to yard sales and clipping coupons and skipping vacations like everyone else on a budget. They could have rented a house until she got a job, but they would have gotten evicted for not paying their rent. Apparently in the current market you can coast for a long time without paying your mortgage before the lender kicks you out.

Edmund L. Andrews:

It's easy to be judgmental about my mistakes. But the point of the book is that this was a mortgage that never should have been taken or offered in the first place.

The question is, how and why did this happen to so many people at the same time? This book attempts to shine a light on how people at every link in the food chain engaged in self-deception.

Naturally, most of the public attention has been on my own personal saga. Fair enough. But the more valuable parts of the book are the stories about my lenders, the financial people behind them and the Washington policymakers it was my fortune to be covering.

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Payless for how long?: How long do your Payless shoes last? I buy good-quality shoes that fit, cost around $50 - $75, and they last six to ten years. That's much less per year than I bet you get!

Michelle Singletary: WRONG!

You lost that bet.

Got payless shoes as long as your $75 shoes.

Got more expensive shoes that last less than payless shoes.

Got cheap shoes that did fall apart. Depends on the shoe not the retailer.

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Delray Beach, Fla.: Michelle, We are finally putting together a hard and fast budget to deal with all of our money issues but I am unsure of how to budget out for those "every once in a while" expenses, like new clothes/shoes for the kids or the random birthday party they get invited to. Should I create a line for Misc. and just carry-forward the amount each month when we don't need it?

Michelle Singletary: Yes, you can still budget for those things. The trick is when that budgeted amount is gone you stop spending. So yes that might mean not going to a party with a gift.

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Rockville: "I don't feel like my good decision making and discipline has put me in a better position that those that make mistakes. Has it?"

What?

In Texas when someone says this sort of thing we just ask "Are you complaining or bragging?"

Michelle Singletary: Amen!

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Washington D.C.: "You can't have a dollar without a penny"!

Michelle, I do so love you!

Michelle Singletary: Love ya right back!!!!

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Arlington, Va.: I don't understand why people who can afford their monthly mortgage payments expect to be able to get mortgage assistance just because they are underwater/upside-down. Obviously no one wants to owe more than what its value is, but if you can make the payments and don't have to move immediately, what is the big deal?

Michelle Singletary: The big deal is they are worried about what is to come with that interest only loan, which means they weren't paying the full cost of the house.

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A Q for Mr. Andrews: It says your wife filed bankruptcy twice. And it looks like she was under unfortunate circumstances.

But here's the thing: she had the chance to skip out on her debts. Twice. Walk away from them.

And then she met you. And it sounds, until the housing mistake, you had a good life. As did she.

Do you think it's fair that she walked away from money she owed to others, only to go on and lead a better life? Has she ever tried to go back and repay those that lost money because of her?

Michelle: isn't responsibility paying back, when you can? It's unfortunate to have the problems that Mr. Andrew's wife had. But she should be required to pay everyone back, given that her life has turned around. No?

If not, then it sounds like she's sluffed off her responsibility.

Edmund L. Andrews: it's not fair to walk away from your debts, but it's also not fair to assume you know why a person was pulled into a bankruptcy.

My wife's first bankruptcy was entirely because her then-husband didn't pay his income taxes for about five years and owed an astronomical amount of money. She was a stay-at-home mom who earned nothing and signed the returns, not knowing that he wasn't sending them in. The second time stemmed largely from the fact that she was caring for four kids as a single mom, and the formerly prosperous ex had become a deadbeat dad.

This kind of thing is horrific, but it doesn't tell you much about my wife's sense of responsibility.

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Just curios, US: What does Mr. Andrews think about this comment that was left on Michelle's review of the book:

"Please Michele, you are giving this guy a free pass because you know him and he works for the NYTimes. Again, he is not telling you the whole truth in his responses. His second wife was not supporting four children in Los Angeles alone at any time in her life. Right now only the youngest child lives with her, the other boys chose to live with their father. Her ex did not fail to file taxes after his wife signed them. This is a lie. She was responsible for the first and second bankruptcies and Mr. Andrews advised her to file the second one after they were married and comingled their assets into this second bankruptcy because he did not want to pay back her sister the $30,000 they owed to her by court order. Mr. Andrews is not being truthful in his responses to you and others, just as he was not truthful in the book by omitting these pertinent facts. I don't know why a respected reporter like you still recommends the book and takes his answers at face value without looking into the matter further. It may sound like a good excuse for his lapse of judgment in writing a half-truthful account of his experience, but it won't hold up in the light.

In answer to a previous post, Mr. Andrews stated that he got a $30,000 advance for his book on one of his talk show interviews."

Edmund L. Andrews: This writer has a personal agenda. Here's my comment: I've laid all my failings and my finances out in public, and my wife volunteered to let herself be exposed as well. That's a lot more than I can say for this writer, who writes only anonymously but had popped up in every single forum imaginable.

Michelle Singletary: First never met or talked to Edmund Andrews before reading his -- ever. And we have no idea what these anonymous posters know or if they are telling the truth. I addressed the failure to mention the bankruptcies in my column.

I still stick to my review and that this book is a cautionary tale worth reading...

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Rockville: "it's not that the offer is worthless -- the loan would be fixed rate and better terms. But we still couldn't realistically afford it."

Sounds like they think they are still negotiating and looking for your best offer.

Edmund L. Andrews: You're right, we are negotiating. It's the same thing that Donald Trump and every other big financial player does upon getting into a jam.

But just to be clear: I'm not making a claim based on moral entitlement, and JP Morgan Chase won't do this out of a sense of charity. They are trying to decide what's in their own self-interest, and I'm pretty sure they won't give me one dollar more than that.

If you think this is "winning,'' you're wrong. My credit scores will be shot for a long time; my finances will take decades to rebuild, if I can pull it off at all.

Anyone who thinks this is a clever way to pull a fast one is mistaken.

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Bowie, Md.: The problem is most likely they could not afford the cost of that house. That's why they had an interest only loan. Not to say this is true for everyone.

Michelle Singletary: Perhaps. You may be right. The point is there are still a lot of these mortgages that will be resetting a lot of folks facing foreclosure as a result.

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Alex., Va.: I also always buy my shoes from Payless and I get more compliments on them (especially at work) then other people do paying way more for shoes.

The key is always to have a good eye and you can find something pretty much everywhere. The same works for clothes.

Michelle Singletary: That's my point exactly. I like to kid around about Payless but the thing is some pricey stuff lasts. Some less pricey stuff lasts.

You just have to be discerning. And not be a slave to the notion that just because something costs more it's better.

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D.C.: Michelle I think the biggest problem is that people have too much STUDENT loan debt which puts them at a disadvantage from the minute they leave school. I just saw the question with the woman who owed 120,000 in student loans. That's absurd unless you are doctor or lawyer and have the potential to make it back. Anything over $30,000 should make kids today really reconsider their school options. You will never be able to afford to live, buy a home etc if your undergrad costs you 6 figures to pay back.

Michelle Singletary: Good point. When I try to make it you would think I spit in someone's face!

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The thing is good financial education should start in the home. It's how it will stick. : So true!

I am a late 30's veterinarian who drives a 1988 Honda that I bought myself (my first car, mum and dad didn't give me one in high school or college), and I am teased by everyone in the practice, "Gee, Dr. T. can't you afford to get a decent car?" I just smile and tell them it is my first car (which it is) that I love. I don't want to sound preachy about saving enough money to pay in full for a new one!

Mum and Dad taught me well.

Thank you!

Michelle Singletary: You are welcome.

Well folks times up. Thanks so much for joining me today. Good questions. Good comments. I like it spicy.

Come back.

Take care.

Be compassionate.

Be grateful.

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