The American Eviction Crisis: Countdown to Doomsday

[Nobel Hobos 2]

Except I doubt the banks are being fucked very hard. They lose cash-flow from mortgages, yes, but aren't they going to get all they're owed eventually?

And are they allowed to still keep adding interest to the debts? If so, they'll actually be better off by the time the mortgage is paid down.

If a one person owes the bank $1000, that’s their problem.
If 60 million people owe the bank $1000, that’s the bank’s problem.

Don't think that a retail bank collapsing means the mortgage holders get to keep "their" house with no more payment. Their mortgage is an asset of the bank, and will be sold on to a secured creditor (possibly the bigger bank who loaned the retail bank money), either before collapse or as part of bankruptcy proceedings.

Banks will 'repossess' some houses too. A few mortgage holders will die. Some will move, so they have no use for the house even if it requires no payments. Some may be convicted of crimes, and so on. Selling those houses should help a retail bank stay afloat.

[Kowani]

If a one person owes the bank $1000, that’s their problem.
If 60 million people owe the bank $1000, that’s the bank’s problem.

Don't think that a retail bank collapsing means the mortgage holders get to keep "their" house with no more payment. Their mortgage is an asset of the bank, and will be sold on to a secured creditor (possibly the bigger bank who loaned the retail bank money), either before collapse or as part of bankruptcy proceedings.

Banks will 'repossess' some houses too. A few mortgage holders will die. Some will move, so they have no use for the house even if it requires no payments. Some may be convicted of crimes, and so on. Selling those houses should help a retail bank stay afloat.

I know that people won’t get to keep their homes. My point was merely that the sheer scale means that some banks are going to be in for a very bad time.

[Nobel Hobos 2]

Don't think that a retail bank collapsing means the mortgage holders get to keep "their" house with no more payment. Their mortgage is an asset of the bank, and will be sold on to a secured creditor (possibly the bigger bank who loaned the retail bank money), either before collapse or as part of bankruptcy proceedings.

Banks will 'repossess' some houses too. A few mortgage holders will die. Some will move, so they have no use for the house even if it requires no payments. Some may be convicted of crimes, and so on. Selling those houses should help a retail bank stay afloat.

I know that people won’t get to keep their homes. My point was merely that the sheer scale means that some banks are going to be in for a very bad time.

Fair enough. I can think of more things they could try, but fortunately I was never born to be a banker!

[Mirjt]

If a one person owes the bank $1000, that’s their problem.
If 60 million people owe the bank $1000, that’s the bank’s problem.

Don't think that a retail bank collapsing means the mortgage holders get to keep "their" house with no more payment. Their mortgage is an asset of the bank, and will be sold on to a secured creditor (possibly the bigger bank who loaned the retail bank money), either before collapse or as part of bankruptcy proceedings.

Banks will 'repossess' some houses too. A few mortgage holders will die. Some will move, so they have no use for the house even if it requires no payments. Some may be convicted of crimes, and so on. Selling those houses should help a retail bank stay afloat.

And I would argue that the ownership of the houses should be taken from the banks and given to the borrowers and the banks forced to absorb the loss.

[Nobel Hobos 2]

Don't think that a retail bank collapsing means the mortgage holders get to keep "their" house with no more payment. Their mortgage is an asset of the bank, and will be sold on to a secured creditor (possibly the bigger bank who loaned the retail bank money), either before collapse or as part of bankruptcy proceedings.

Banks will 'repossess' some houses too. A few mortgage holders will die. Some will move, so they have no use for the house even if it requires no payments. Some may be convicted of crimes, and so on. Selling those houses should help a retail bank stay afloat.

And I would argue that the ownership of the houses should be taken from the banks and given to the borrowers and the banks forced to absorb the loss.

Feelgood socialism. Who doesn't like free stuff?

I respect those people with the purposefulness and the confidence in themselves (and often their partner) to settle in one house and gradually over decades, pay it off. Often they raise children at the same time, which is admirable in itself. But it's only possible for them to do that because there are banks willing to lend them (almost) the full cost of the house.

Imagine how much harder it would be if you couldn't get a loan, and had to negotiate a system of payments with the previous owner of the house. They would only let you live there right away, if you paid rent. Then I guess the rent would gradually decrease as your ownership of the house increased. If it took as long as the typical home-loan takes to pay off, you'd be doing very well indeed if you paid overall less than twice the price you signed up for. You also wouldn't be able to modify the house without the original owner's permission.

Does this sound better to you, than the current system of taking out a loan to buy a house? Well it had better, because if you expropriate millions of (equities in) houses from the banks, you would hugely increase the risk they consider in making loans in the future. That means much higher interests rates and/or longer repayments, meaning people have no good options besides renting, or a repayments scheme with a previous owner who still has disputable property rights.

The current system used to work quite well. Couples with 1-and-a-half incomes and two kids could pay off a home in 10 to 15 years. Then they could look for second careers, or a few years later the kids leave home. In any case they would own an asset worth twice or more what it cost when they first got it. If they sold, they got the cost plus all the interest they'd paid, breaking even, with years of free accommodation as bonus.

But now it's a life sentence, and many people can't even get onto the use-an-asset-then-sell-it gravy train. I find it hard to blame banks for that, except when they fail due diligence and lend to people who realistically aren't likely to keep paying to the end. It's all about land prices and the widened gap between rich and everyone else.

[Mirjt]

And I would argue that the ownership of the houses should be taken from the banks and given to the borrowers and the banks forced to absorb the loss.

Feelgood socialism. Who doesn't like free stuff?

I respect those people with the purposefulness and the confidence in themselves (and often their partner) to settle in one house and gradually over decades, pay it off. Often they raise children at the same time, which is admirable in itself. But it's only possible for them to do that because there are banks willing to lend them (almost) the full cost of the house.

Imagine how much harder it would be if you couldn't get a loan, and had to negotiate a system of payments with the previous owner of the house. They would only let you live there right away, if you paid rent. Then I guess the rent would gradually decrease as your ownership of the house increased. If it took as long as the typical home-loan takes to pay off, you'd be doing very well indeed if you paid overall less than twice the price you signed up for. You also wouldn't be able to modify the house without the original owner's permission.

Does this sound better to you, than the current system of taking out a loan to buy a house? Well it had better, because if you expropriate millions of (equities in) houses from the banks, you would hugely increase the risk they consider in making loans in the future. That means much higher interests rates and/or longer repayments, meaning people have no good options besides renting, or a repayments scheme with a previous owner who still has disputable property rights.

The current system used to work quite well. Couples with 1-and-a-half incomes and two kids could pay off a home in 10 to 15 years. Then they could look for second careers, or a few years later the kids leave home. But now it's a life sentence, and many people can't even get onto the use-an-asset-then-sell-it gravy train. I find it hard to blame banks for that, except when they fail due diligence and lend to people who realistically aren't likely to keep paying to the end. It's all about land prices and the widened gap between rich and everyone else.

The banks will still loan out money because it is how they make their money, this would just increase the risks in loaning money. To make up for the lack of loans being provided by for-profit banking, I would propose a system of public banking and credit unions. Banks will still be profitable, but they will be less profitable and they will just have to deal with that if they want to have any profit at all. Also occasionally forgiving and cancelling all kinds of debt is actually helpful for stabilizing economies, look up the history of debt jubilees.

[Nobel Hobos 2]

Feelgood socialism. Who doesn't like free stuff?

I respect those people with the purposefulness and the confidence in themselves (and often their partner) to settle in one house and gradually over decades, pay it off. Often they raise children at the same time, which is admirable in itself. But it's only possible for them to do that because there are banks willing to lend them (almost) the full cost of the house.

Imagine how much harder it would be if you couldn't get a loan, and had to negotiate a system of payments with the previous owner of the house. They would only let you live there right away, if you paid rent. Then I guess the rent would gradually decrease as your ownership of the house increased. If it took as long as the typical home-loan takes to pay off, you'd be doing very well indeed if you paid overall less than twice the price you signed up for. You also wouldn't be able to modify the house without the original owner's permission.

Does this sound better to you, than the current system of taking out a loan to buy a house? Well it had better, because if you expropriate millions of (equities in) houses from the banks, you would hugely increase the risk they consider in making loans in the future. That means much higher interests rates and/or longer repayments, meaning people have no good options besides renting, or a repayments scheme with a previous owner who still has disputable property rights.

The current system used to work quite well. Couples with 1-and-a-half incomes and two kids could pay off a home in 10 to 15 years. Then they could look for second careers, or a few years later the kids leave home. But now it's a life sentence, and many people can't even get onto the use-an-asset-then-sell-it gravy train. I find it hard to blame banks for that, except when they fail due diligence and lend to people who realistically aren't likely to keep paying to the end. It's all about land prices and the widened gap between rich and everyone else.

The banks will still loan out money because it is how they make their money, this would just increase the risks in loaning money.

Yes by raising interest rates on the kinds of loans you just made more risky for them. Probably small business loans too, depending on the sector they think is most vulnerable to unconditional bailouts.

To make up for the lack of loans being provided by for-profit banking, I would propose a system of public banking and credit unions. Banks will still be profitable, but they will be less profitable and they will just have to deal with that if they want to have any profit at all.

Isn't public banking obliged not to lend to anything unhealthy, bad for the environment, exploitative or unethical?

Property speculation, which homebuyers are involved in whether they know it or not, is kind of unethical. Unless you also have price controls on houses.

Also occasionally forgiving and cancelling all kinds of debt is actually helpful for stabilizing economies, look up the history of debt jubilees.

Hmm, interesting. I think you'll have to at least draw the line, of how much equity in their home is rewarded with the whole home. That might give banks some assurance for the future that they aren't going to lose all their money on a particular loan.

[San Lumen]

Don't think that a retail bank collapsing means the mortgage holders get to keep "their" house with no more payment. Their mortgage is an asset of the bank, and will be sold on to a secured creditor (possibly the bigger bank who loaned the retail bank money), either before collapse or as part of bankruptcy proceedings.

Banks will 'repossess' some houses too. A few mortgage holders will die. Some will move, so they have no use for the house even if it requires no payments. Some may be convicted of crimes, and so on. Selling those houses should help a retail bank stay afloat.

I know that people won’t get to keep their homes. My point was merely that the sheer scale means that some banks are going to be in for a very bad time.

and if the Banks collapse its the 1930s all over again only this time it will be far worse because the world economy was less interconnected then.

[Kowani]

I know that people won’t get to keep their homes. My point was merely that the sheer scale means that some banks are going to be in for a very bad time.

and if the Banks collapse its the 1930s all over again

Well, no, it's the 1930's because millions will be out of work and homeless with no income, and the banks will just exacerbate that.

[San Lumen]

and if the Banks collapse its the 1930s all over again

Well, no, it's the 1930's because millions will be out of work and homeless with no income, and the banks will just exacerbate that.

That was my point and we are well on our way. This whole thing was self inflicted

[Kowani]

Well, no, it's the 1930's because millions will be out of work and homeless with no income, and the banks will just exacerbate that.

That was my point and we are well on our way. This whole thing was self inflicted

Ahh. yes, entirely so.

[Ifreann]

People can't pay rent = evicted
Federal government passes laws that prevent eviction during a pandemic = landlords cannot collect and pay their bills/mortgages = property gets leined and/or foreclosed = tenants evicted anyway.

Shit sucks, but the landlords gotta get paid to keep their properties afloat.

Cancel mortgage along with rents and landlords will get to keep their homes, just like everyone else.

---

Treat the discussion as you trying to disabuse me of my "extremist" views.

Besides, neither of the two people are all that extreme. Adam Smith is basically the first economist to theorize about capitalism and Josiah Warren is an individualist anarcho-pacifist, basically an ultra-libertarian.

We can provide a decent standard of living with our current property rights. So changing them is extreme.

Plainly you cannot, hence this thread.

[The Black Forrest]

People can't pay rent = evicted
Federal government passes laws that prevent eviction during a pandemic = landlords cannot collect and pay their bills/mortgages = property gets leined and/or foreclosed = tenants evicted anyway.

Shit sucks, but the landlords gotta get paid to keep their properties afloat.

Cancel mortgage along with rents and landlords will get to keep their homes, just like everyone else.

---

We can provide a decent standard of living with our current property rights. So changing them is extreme.

Plainly you cannot, hence this thread.

How about a pandemic law where the banks are order to stop collecting debts? They can charge interest and maybe a fee.

[Nobel Hobos 2]

Cancel mortgage along with rents and landlords will get to keep their homes, just like everyone else.

---

Plainly you cannot, hence this thread.

How about a pandemic law where the banks are order to stop collecting debts? They can charge interest and maybe a fee.

Get out of here with your banksterism!

[The Black Forrest]

How about a pandemic law where the banks are order to stop collecting debts? They can charge interest and maybe a fee.

Get out of here with your banksterism!

Well? We do need something. We can’t trust the secretary of the treasury who made a fortune from foreclosures.

[Nobel Hobos 2]

Get out of here with your banksterism!

Well? We do need something. We can’t trust the secretary of the treasury who made a fortune from foreclosures.

If it wasn't for the corporate veil, I would offer retail banks (who make home loans) the option not to pay interest on the loans they have with other banks or individual investors. Though to avoid that spreading throughout the whole banking sector, it might be only a partial amnesty (eg only having to pay half the agreed interest payment to another bank).

The corporate veil and extreme complexity of inter-bank lending though, poses a bad risk of government getting ripped off somehow. One of the banks will push the "too big to fail" button and government will have to cough up, for instance.

Home loans are a third of US private sector debt. Mortgage payments would be about the same proportion of banking loan income. It's probably not a good thing to be heavy handed with!

[Greed and Death]

People can't pay rent = evicted
Federal government passes laws that prevent eviction during a pandemic = landlords cannot collect and pay their bills/mortgages = property gets leined and/or foreclosed = tenants evicted anyway.

Shit sucks, but the landlords gotta get paid to keep their properties afloat.

Cancel mortgage along with rents and landlords will get to keep their homes, just like everyone else.

Then the banks go under and we have to add a repeat of 2008 to the mess.

[San Lumen]

People can't pay rent = evicted
Federal government passes laws that prevent eviction during a pandemic = landlords cannot collect and pay their bills/mortgages = property gets leined and/or foreclosed = tenants evicted anyway.

Shit sucks, but the landlords gotta get paid to keep their properties afloat.

Cancel mortgage along with rents and landlords will get to keep their homes, just like everyone else.

---

We can provide a decent standard of living with our current property rights. So changing them is extreme.

Plainly you cannot, hence this thread.

Enjoy reliving the 2008 crisis when the global economy nearly collapsed from doing something so monumentally stupid that we pay another trillion dollars to rescue the banks to prevent a global financial meltdown.

Or should we just let that happen this time? That would be no big deal right? As long as the healthcare system functions that's all the matters.

I have news for you if the global financial system collapsed the healthcare system would too.

[Nobel Hobos 2]

Cancel mortgage along with rents and landlords will get to keep their homes, just like everyone else.

---

Plainly you cannot, hence this thread.

Enjoy reliving the 2008 crisis when the global economy nearly collapsed from doing something so monumentally stupid that we pay another trillion dollars to rescue the banks to prevent a global financial meltdown.

Or should we just let that happen this time? That would be no big deal right? As long as the healthcare system functions that's all the matters.

I have news for you if the global financial system collapsed the healthcare system would too.

You don't think the private health insurers would give Democrats that satisfaction do you?

It would be an absolute gift. All those people who used to be happy with their private insurance would be suddenly in favor of Medicare For All, support for some kind of universal government healthcare would hit 80% or so, and soon after the financial institutions would be permanently locked out of health insurance.

Businesses failing isn't always bad, SL! Those who've been making profits off life and death, America would be better off without.

[The Rich Port]

Rent should really be abolished, but we could at least suspend it as well as evictions for the time being.



In fact, there's enough housing in the U.S. for everyone, only because they're "private property" it would be a crime to enter them. We should let anyone in need into these homes.

I dunno about that, but in the end, well, yeah, there isn't much the police can do about millions of people potentially breaking into empty properties and squatting there.

Squatting and homelessness is going to become a huge, untenable problem... One that the Trump administration probably has very little understanding of, much like it does basic politics.

[Plzen]

Squatting and homelessness is going to become a huge, untenable problem... One that the Trump administration probably has very little understanding of, much like it does basic politics.

Maybe the US should adopt that same law that the Netherlands used to have at the height of their homelessness crisis:

If you stay at a residence for so-and-so many hours you are a resident and cannot be kicked out without an eviction order from a court of law.

[Unstoppable Empire of Doom]

Im super excited for houses to go on sale

[Prizea]

Squatting and homelessness is going to become a huge, untenable problem... One that the Trump administration probably has very little understanding of, much like it does basic politics.

Maybe the US should adopt that same law that the Netherlands used to have at the height of their homelessness crisis:

If you stay at a residence for so-and-so many hours you are a resident and cannot be kicked out without an eviction order from a court of law.

Assuming you are talking about dramatically cutting down the time required to be a squatter to a matter of hours rather than days, I’m not convinced that would be such a good idea. It would actively incentivise breaking into houses and something that the Netherlands doesn’t have is a lot of legal guns and stand your ground laws floating around.

Consider the following situation. A family goes out for a day trip to go walking or get a meal or something, and in the time they are away somebody breaks into their home to start the clock ticking on this squatting-plus law. If they come back and shoot this strange person who has broken into their home, how likely do you think it is that a jury is going to convict the person for the shooting if they claim a fear for their life?

Furthermore, does it matter if they were technically a tenant at this point, or hadn’t yet reached the requisite time? Does it matter the composition of the family (for example, would they acquit if there was children and convict otherwise)? Would the races of the two involved parties matter? Does it matter if they were aware that the person was trying to claim residency beforehand? What about if it was a holiday home?

It’s probably not too big a problem right now, since only the more long-term empty houses are usually worth trying to squat in, but given a relatively unpopular law (which this certainly would be in quite a lot of parts of the US) and a massive surge in occurrences you could end up driving people into a homeowners dilemma (shoot without asking questions or lose your home) that would almost certainly end up disproportionately killing minorities (since the cognitive dissonance would be less). Which, given the current situation in the US, is just going to spark an even bigger powder keg.

[Unstoppable Empire of Doom]

Imagine how much harder it would be if you couldn't get a loan, and had to negotiate a system of payments with the previous owner of the house. They would only let you live there right away, if you paid rent. Then I guess the rent would gradually decrease as your ownership of the house increased. If it took as long as the typical home-loan takes to pay off, you'd be doing very well indeed if you paid overall less than twice the price you signed up for. You also wouldn't be able to modify the house without the original owner's permission.

Does this sound better to you, than the current system of taking out a loan to buy a house?

It sounds identical.

[The Rich Port]

Maybe the US should adopt that same law that the Netherlands used to have at the height of their homelessness crisis:

If you stay at a residence for so-and-so many hours you are a resident and cannot be kicked out without an eviction order from a court of law.

Assuming you are talking about dramatically cutting down the time required to be a squatter to a matter of hours rather than days, I’m not convinced that would be such a good idea. It would actively incentivise breaking into houses and something that the Netherlands doesn’t have is a lot of legal guns and stand your ground laws floating around.

Consider the following situation. A family goes out for a day trip to go walking or get a meal or something, and in the time they are away somebody breaks into their home to start the clock ticking on this squatting-plus law. If they come back and shoot this strange person who has broken into their home, how likely do you think it is that a jury is going to convict the person for the shooting if they claim a fear for their life?

Furthermore, does it matter if they were technically a tenant at this point, or hadn’t yet reached the requisite time? Does it matter the composition of the family (for example, would they acquit if there was children and convict otherwise)? Would the races of the two involved parties matter? Does it matter if they were aware that the person was trying to claim residency beforehand? What about if it was a holiday home?

It’s probably not too big a problem right now, since only the more long-term empty houses are usually worth trying to squat in, but given a relatively unpopular law (which this certainly would be in quite a lot of parts of the US) and a massive surge in occurrences you could end up driving people into a homeowners dilemma (shoot without asking questions or lose your home) that would almost certainly end up disproportionately killing minorities (since the cognitive dissonance would be less). Which, given the current situation in the US, is just going to spark an even bigger powder keg.

I believe that that Netherlands law doesn't apply if there is already a tenant living on the property, so. blah.

And yeah, not a problem now, heck, might not even be a problem soon.

But it's going to be a problem and I for one do not want to explain to the dozen or so people that pass by my house a day asking for food or shelter that I can't because I'm barely scraping by myself.