Buying into home ownership debt…No thanks!
In America home ownership debt has become more of a financial trap than a fact of simple dwelling. Homes have gradually increased in size, ‘amenities’, and costs. Why is this? To be put simply, to capture the average American and harness them by the means of debt accrual. Once in debt its just another payment to be made. After making so many payments its just another, thus the trap is set of a life in debt. Work and make payments, and what is the difference between enlisting to make payments for 30 years or 50 years right? Being in debt is being in debt. A link to an interesting write up with some quotes from Thoreau.
The bigger the home, the more appliances, the more baths, the more, specialized infrastructure the higher the cost. Homes have become so expensive due to their increased scale that unless one has a benefactor or a trust fund there is pretty much no way it can be bought outright. So this means to go to the bank and take out a loan. The larger the home the larger the loan with few exceptions. When a person or family goes to look at a new home without capital up front they are in the pockets of the banker from the get go. This is not just because Americans have demanded larger homes it is because home construction is a rigged show.
Bankers and Realtors know this. And they know the psychology of a buyer much like a car salesman. Its all about a seemingly polished product with a whole lot of bells and whistles. Most people who have bought a ‘lemon’ vehicle that broke down and they still had to make the bank payments know next time to look under the hood and under the vehicle, and to forget about the bells and whistles, they wont get you anywhere. Home design of today are similar to this in that just because a home looks good today has no reflection on how it will look in 10 years. All of the space and added extras seem wonderful until one has to pay the electric, heating bills and maintenance. And bigger yet when one is still paying the interest on a home after 20 years of hard 40 to 50 hour a work weeks with no end in sight at actually paying on the principle. This is the trap and this is the illusion, I don’t think of it as a ‘dream’ and more as a nightmare.
So how does one avoid this situation. There are simple rules like save your money, don’t start living on credit, plan for your home and when you have enough saved get started. Sounds impossible right? Well it is and it isn’t. For one, you have to divorce yourself from what the ‘Jone’s’ are doing. Just remember the huge home and the new SUV’s they have are all traps that consumers have sprung on themselves with a little help from the bank. They are illusive ownerships. I think most Americans today can relate to how much of an illusion real estate really is with home foreclosures and mortgage debt seizing up all around. You don’t own it until you own it! Do you really want your life, in the end, to be epitomized by how hard you worked to own a box?