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Living within our means
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There is no doubt about it - the current foreclosure problem in the nation and Stanislaus County, in particular, is tragic. The fact that many families are being turned out of their houses because they are no longer able to afford their homes - nor have them refinanced because they are not worth what they paid for them - is disheartening.

It's very sad, also, to see so many houses sitting vacant and falling into a state of neglect in just about every neighborhood these days. You see it in Eastgate on Ceres' east side. You see it in the older neighborhoods, too.

Monday of this week was a sad day for California. On that single day, a record number of 5,238 properties were to be sold on the steps of the county courthouses across the state. The numbers were particularly high because some banks were restraining from issuing foreclosures during the holiday season.

In case you haven't noticed, just take a look at the sheer number of foreclosure notices that are even running in this paper. Things won't be getting much better since experts are saying the foreclosure rates will worsen this year.

My intent is not to rub salt in the wounds of anyone who has been in this unfortunate circumstance. But collectively we as a country and as individuals must do some honest soul-searching to make sure this doesn't happen again. I'm not talking about calling for the government to do something because frankly the government should not rescue people who made bad real estate deals. Blame the lending institutions if you want, if it makes you feel better, but the bottom line is that buyers need to own up to the fact that they made some poor financial decisions.

I know that some people have lost their homes because of the loss of jobs. The are some things workers have no control over, such as Hershey moving its plant south of Mexico. (Who said NAFTA was such a good idea anyway?) But I'm mostly talking about the folks who took on those variable rate mortgages and who bit off more house than they could chew. They listened as the lenders pencil out loans and push income-to-debt ratios past the limits of reason which should have set off alarms in their heads. But they proceeded to make a purchase anyway, most out of fear that housing prices would continue to escalate.

Others got hurt in this market in a different way. If you were in the process of selling your property in the hopes of moving up before the bubble broke. I am one of them. I know I'm not going to get much sympathy from those who lost their homes, but I ended up paying for the financial carelessness of thousands.

My wife and I have been doing everything right. We bought our home back in 1986, improved it, expanded it, kept it nice and didn't borrow against the equity. The house is nicer than the neighborhood and frankly I want out. We tried. We had our sights on a new house in a new subdivision. The move made sense to us. We were getting an opportunity to buy a brand-new two-story house in a gated community by taking on only about $15,000 extra in debt. We entered into the agreement before the market went to hell in a handbasket. The developer kept dropping the new house price so that we could drop the price on our house to make it more attractive. But by then the market was flat-lining and nobody had the paddles to shock it back to life. We had our house listed for well over a year and never had a good offer - that is until the 11th hour. We found a buyer but you guessed it: she could not buy our house until she sold hers. The deal was dead on arrival. The developer finally cut us loose from our contract. Unlike tens of thousands of other Americans, we simply weren't willing to go into significant debt to purchased move-up housing. We denied ourselves because we didn't want to be enslaving ourselves unnecessarily. We lost a chance to move into our dream home after 26 years of home ownership, mostly because others in this country recklessly pursued home ownership without carefully considering the perils and they defaulted.

I have to look at the good side: in less than three years my mortgage is paid off. Maybe by then the market will allow us to move up.

Anyone who studied the 1989-90 housing bubble pop should have seen this one coming. Prices simply rose too sharp, too fast. And they retreated back to original levels.

Indeed, this sad chapter in American history should cause us all to think soberly about our financial decisions. We cannot as a country continue to spend, spend, spend if we don't have, have, have. Americans are going crazy with debt and I see it as a means to ruin many families. Marriage counselors will be the first to tell you that financial hardships is one of the biggest causes of marriage failure.

It should be the goal of everyone in this country to get out of debt, not climb headfirst into it. Not too long ago we had a generation that saved up for things when they wanted them. They didn't borrow money for frills. They were frugal. They worked hard for what they got, without borrowing. They realized that purchasing something was a far greater an experience after one saved for it rather than paying with borrowed money. But many Americans don't want to deny themselves the giant screen TVs, fancy cars, designer furniture and pleasure craft.

This should not be a novel approach: but we need to spend less than what we make. How many of us are taught that growing up?

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