I had the unique opportunity of analyzing loan dockets of delinquent borrowers. In many occasions, it was clear to me some of these borrowers bought a house they could not afford in the first place. Their mortgage payment was over 30 to 35% of their take home pay which is a recipe for disaster. The discretionary income could not support the least of emergency like a replacement battery or a couple of replacement tires. Of course I was looking at numbers. But the problem is deeper than that. I know a young lady who decided that a 3 bedroom, two car garage, two bathrooms and a fireplace were too small for her. That was my house at the time. But at that time, she was staying with her mother, her grandmother, and 2 young kids in a 3 bedroom house and a bath. I am guessing she must have been very unhappy with her living condition. She surely did not want what she can afford. Wanting what you can afford can make us a happier person.. I was very happy with my red VW rabbit and never wanted a BMW or a Cadillac. Today I live in 2 bedroom house […] read more