On CNN tonight, I saw an article about a single mother who was making $70,000 a year until she was laid off in February. She has now resorted to using a foodbank to feed her family (See the full story here). Sad story eh? Boo hoo.
She can’t afford to pay her utility bills because she is trying to pay her $2,500 per month “interest-only” mortgage. Something is very wrong with this picture. She has 2 kids, makes $70,000 a year, and she’s paying a $2,500 a month “interest-only” mortgage? How on earth can people make such poor financial decisions to get them to the point where they are paying $2,500 a month entirely in interest, and supporting 2 kids.
The first thing I’d do if I were laid off is sell my house and move into an $800 a month rental apartment. Or maybe you can’t sell your house because it will sell for less than you paid for it and since you put $0 down on your house, you’d owe the bank money, and you’d have no house. In that case, sell your Hummer and your Chevy pickup and rent out half your house for some rental income.
But I guess the easier approach would be to contact CNN, have them write a story about how you went from 70K a year to a food bank and then people will feel sorry for you and send you checks in the mail and offer you a job to get their company some publicity.
It’s amazing how many people got suckered by the financial institutions into making such horrible financial decisions. Sometimes a little bit of regulation isn’t a bad thing.
Image courtesy of www.flavorphoto.com