Thoughts On Finance

Honestly, when I first heard that a family who had a home built for them by the popular TV show, Extreme Makeover Home Edition, was having their house foreclosed on I honestly thought, wow what a waste. I mean you get a customized home built for you for free, and then you wind up having this home foreclosed on. Well, I heard an interview with the husband and wife who are living in the home and it changed my mind. They did have a beautiful home built for them, when they received the home, they were also given a $100,000 home maintenance fund but they did still have to pay the mortgage, which was the equivalent of what they were paying before the makeover and the taxes, which stayed the same for the first few years and then went up. This couple said that the home itself was costing them $6000 per month to keep up, and in addition to that they have a large family which also included some children with special needs, they didn’t really get into the special needs of each child. In any case, these people said that in addition to almost losing their home and being in financial ruin which is difficult enough, that they were receiving hate mail and threatening letters from viewers of the show who were angered to hear that they might be losing the home the show gave them. Honestly, I learned some things about home ownership in watching this show. I didn’t realize that there is something called a homestead protection, which says that if you own a home the only person who can sell that home out from under you is the mortgage company, however, once you take out a home equity loan, even if it is just for a very small amount, then they can come and sell your home out from under you if you don’t pay back the loan. For instance let’s say you borrow $10,000 dollars off your home, but your home is worth $500,000 if you don’t pay that loan, then that company can come and sell that home right out from under you to get back their $10,000. I didn’t really realize that it worked like that. In any case, these people did borrow money off their Extreme Makeover home, but it was really to put their kids in a rehab program and to start a new business. They didn’t just go out and blow the money and lose the home as some reports might make you think. This just goes to show that anyone can have their finances spiral out of control, it just takes a few mistakes and you can very easily find yourself in a hole without a shovel.

I don’t really understand why our government is allowing price gouging. I do understand that the cost of oil is up, but did you know that the cost of a gallon of gas in Iraq is just .39 and right now the average price in the US is about $3.50. I do understand that oil costs us more than it does in the US, but I have started thinking that the local food companies are taking advantage of the increase in trying to claim that it is costing them so much more to produce and transport products than it actually is. Don’t get me wrong, I do believe that there has been a cost increase to the companies, and I don’t mind contributing to absorbing that cost, but the prices of groceries are climbing so intensely that the sticker price on some items is up to almost double what it was just 6 months ago, and quite honestly the gas prices have not risen enough to truly warrant those types of increases on each product. I have spoken to some people about this, and many people are buying the fact that it is costing these companies so much more to produce and transport these items, but I am not biting. It seems to me that stores, food manufacturers and transport companies are using this difficult financial time to convince consumers to pay more for their items, and it is working. A friend recently told me, don’t worry the gasoline prices should come down again in the next 6 months, and my response was, do you really think that the grocery prices will? This kind of price gouging should not be tolerated, and our government had better intervene before this problem gets completely over the top.