8 ms·

"take the hit for 7 years" This is the advice I've heard given to people who are severely underwater on a mortgage, but the idea that you can get sick one time

"take the hit for 7 years" This is the advice I've heard given to people who are severely underwater on a mortgage, but the idea that you can get sick one time and be financially ruined is still astonishing to me. I guess everywhere has some legislation that is just bonkers, though. I only just recently found out from a friend that you can't legally walk away from a mortgage here (UK) without declaring bankruptcy like you can in the States, which is bananas.

gascan 8y ago
the idea that you can get sick one time and be financially ruined is still astonishing to me. FWIW I'm not aware of many people who come down with a cold and are financially ruined. The people I know who are in crippling medical debt have, for example, had both kidneys replaced. While I'm not happy they are in those circumstances, it's not hard to picture two replacement kidneys and all the other treatments involved as mind-bendingly expensive. It seems worthwhile to distinguish, at least a little bit, severity when we are talking about this.
- headmelted 8y ago
  Still though (and correct me if I'm wrong), but if you get sick tomorrow with some ailment for which treatment is complex (and therefore expensive) AND you don't have insurance - your options are to find the money or go bankrupt? That's nuts in 2018 in a wealthy democracy.
  - chimeracoder 8y ago
    > Still though (and correct me if I'm wrong), but if you get sick tomorrow with some ailment for which treatment is complex (and therefore expensive) AND you don't have insurance - your options are to find the money or go bankrupt? That's nuts in 2018 in a wealthy democracy. Treating complex conditions (like cancer) is exactly where the US excels, compared to other countries. Yes, it's expensive, but the alternative is, well, dying. Since the grandparent mentioned the UK specifically, I'll point out that the US has dramatically higher survival rates for treatable forms of cancer than the UK does. For prostate cancer - generally one of the most treatable forms of cancer, if treated properly - people in the US have over a 90% chance of survival[0]. The UK, on the other hand, has absolutely abysmal surival rates - second-worst of all OECD countries, and a mortality-to-incidence ratio that's almost twice what you see in the US. Yes, the US could do a better job at making that top-of-the-line care accessible to more people, but even then, the baseline care for complex treatments specifically is actually much higher than what the UK provides. [0] That's over the entire population, so it's including people who are uninsured and can't afford the most expensive treatments.
    - bacon_waffle 8y ago
      As someone who emigrated from the US to New Zealand (where we have a socialised medicine system), I'm curious about the relationship between those survival rates, and the related diagnoses. Here in NZ, it seems like there's much less hesitation in a person going to the doctor in the first place, compared to the US, and I'd imagine that has some positive impact on the population. Perhaps there is a tradeoff between treatment of complex conditions, and treatment of more frequent but less complex conditions?
  - nonbel 8y ago
    Nah, you just have to go elsewhere because the US healthcare system apparently includes a bunch of unnecessary or overpriced expenses. Or you just say you dont have insurance so you get charged at 10-50% the "chargemaster" price. Think about how cuba is able to have similar life expectancy, etc at a fraction of the cost with chronic shortages and subpar sanitation. Most likely there are many medical procedures doing at best nothing for the patient except draining their wallets. Worse, it could be that treatment 1 for problem A causes problem B which leads to treatment 2, etc, etc for some moderate benefit at great cost over just dealing with problem A. Worst, it could be the medical treatments are having a net negative effect on people's health. Eg, those studies that estimate hospital errors (not even just death from dangerous treatments applied as standard) are the third leading cause of death in the US.
    - castlecrasher2 8y ago
      > Think about how cuba is able to have similar life expectancy, etc at a fraction of the cost with chronic shortages and subpar sanitation. I suspect most of the US' problems is the atrocious lifestyle most live; overeating and under-exercising are literally a lethal combination.
      - nonbel 8y ago
        Well the overeating is partially the healthcare industry's fault due to poor nutritional recommendations. People in general should not have grains as the main basis for their diet. This type of diet makes many people eat more than they otherwise would. I would post a pubmed link but sorry, youll have to just try it yourself and read blogs because the medical researchers still haven't caught up to this. They are still calling a 30% carb diet "low carb".
  - TearsInTheRain 8y ago
    Why is that nuts? Honestly it seems kind of nuts that someone would expect another person to pick up their tab
    - TaylorAlexander 8y ago
      I honestly feel like it’s nuts that we don’t collectively fund healthcare, precisely because I don’t want to live in a world where I may be ruined by an illness and I am willing to pay to make sure others don’t have to live in that world. However I am specifically a proponent of voluntary collectives for things, as government forced cooperation seems suboptimal and fragile to me.
      - gascan 8y ago
        Aren't these two things mutually incompatible? How do you have universal healthcare that doesn't let anyone be bankrupted by their illness, where participation is also voluntary? And isn't voluntary collective healthcare just another way to describe private insurance companies, especially HMO's?
        zaarn 8y ago
        Well, with universal and mandatory healthcare you wouldn't be bankrupted by your illness since the insurance covers it. The population at large pays for the few that need the expensive treatments.
      - AnthonyMouse 8y ago
        > I honestly feel like it’s nuts that we don’t collectively fund healthcare, precisely because I don’t want to live in a world where I may be ruined by an illness and I am willing to pay to make sure others don’t have to live in that world. Isn't this the exact thing insurance solves, in particular catastrophic coverage insurance? Nobody really gets "ruined" by paying out of pocket for one X-ray and two aspirin. The problem is that the insurance is so expensive some people can't afford it. But the only sense in which single payer would "fix" the high cost/overhead/waste problem is by de facto regulating prices, which can be done even without it but which has a lot of obvious problems -- if the regulator chooses too high a price then it's still wasteful/unaffordable but too low and there will be no providers (or the providers will sacrifice quality to hit the regulated price). What we need is a real solution to cost disease, which probably has something to do with reducing the regulatory compliance costs so there will be less overhead and more viable competing providers, requiring price transparency from providers, and then having people pay out of pocket for all non-catastrophic care so the patient has the incentive to decline treatment or find a less expensive provider when the treatment is unnecessary or overpriced.
  - cliffordthedog 8y ago
    Nah, you can also just die.
iamaelephant 8y ago
Why is it bananas that you can't just walk away from a debt? The foreclosure system in USA is a significant part of what caused the mortgage crisis.
- headmelted 8y ago
  You should absolutely be able to walk away from a debt. If I'm a bank, and you come to me for a $75k mortgage on a $100k house, the $25k down is my security. That should be the beginning and end of our transaction. If you stop paying the mortgage, the bank gets the house. If the bank reasonably believed there was a chance of the house being worth less than the amount borrowed during the term, they shouldn't have made the deal. It's a simple system that makes perfect sense. Holding people to account beyond the security, as they do in the UK, encourages predatory lending behaviours and is utterly unfair to the borrower.
  - sobani 8y ago
    In other countries (for example the Netherlands) YOU take the loan, not your house. To make sure the bank won't be left holding the bag, you use the house you're about to buy as collateral. In the occasion you stop paying, the bank will foreclose the house, but YOU are still liable for the rest of the loan. If you still don't pay, an official collection agency (not your bank, that would be a conflict of interest) will try to cut a deal, come and take your stuff and/or garnish your wages to pay of the loan. You can insure yourself against calamities like divorce and losing your job, for which the bank will give you a discount on the interest rate. Mortgages are limited by what you can afford, so a predatory mortgage loan is practically an oxymoron. Down payments are uncommon, especially for a first time buyer. The only money you need to bring with you is transaction costs (~5% : taxes, notary, financial advisor, etc.) and whatever you think you need for decorating.
ACow_Adonis 8y ago
It's almost as though both you and the lender should think deeply, be conservative, and do your homework before taking out something as large as a mortgage!
- headmelted 8y ago
  Let's not pull at that thread. I've tried to convince people for years that the biggest cause of the 2008 crash wasn't the banks, it was the rating agencies, but that's more complicated than people want to get with it. It's a lot easier to just believe that "the system" is "rigged" and "out to get you". In the UK, people should've known they couldn't repay their mortgage if they got in trouble, and it's why I continued renting until 2013. In the US, I'd have happily bought a house with 0% down and no obligation if it goes against me.

gascan 8y ago

the idea that you can get sick one time and be financially ruined is still astonishing to me. FWIW I'm not aware of many people who come down with a cold and are financially ruined. The people I know who are in crippling medical debt have, for example, had both kidneys replaced. While I'm not happy they are in those circumstances, it's not hard to picture two replacement kidneys and all the other treatments involved as mind-bendingly expensive. It seems worthwhile to distinguish, at least a little bit, severity when we are talking about this.

headmelted 8y ago
Still though (and correct me if I'm wrong), but if you get sick tomorrow with some ailment for which treatment is complex (and therefore expensive) AND you don't have insurance - your options are to find the money or go bankrupt? That's nuts in 2018 in a wealthy democracy.
- chimeracoder 8y ago
  > Still though (and correct me if I'm wrong), but if you get sick tomorrow with some ailment for which treatment is complex (and therefore expensive) AND you don't have insurance - your options are to find the money or go bankrupt? That's nuts in 2018 in a wealthy democracy. Treating complex conditions (like cancer) is exactly where the US excels, compared to other countries. Yes, it's expensive, but the alternative is, well, dying. Since the grandparent mentioned the UK specifically, I'll point out that the US has dramatically higher survival rates for treatable forms of cancer than the UK does. For prostate cancer - generally one of the most treatable forms of cancer, if treated properly - people in the US have over a 90% chance of survival[0]. The UK, on the other hand, has absolutely abysmal surival rates - second-worst of all OECD countries, and a mortality-to-incidence ratio that's almost twice what you see in the US. Yes, the US could do a better job at making that top-of-the-line care accessible to more people, but even then, the baseline care for complex treatments specifically is actually much higher than what the UK provides. [0] That's over the entire population, so it's including people who are uninsured and can't afford the most expensive treatments.
  - bacon_waffle 8y ago
    As someone who emigrated from the US to New Zealand (where we have a socialised medicine system), I'm curious about the relationship between those survival rates, and the related diagnoses. Here in NZ, it seems like there's much less hesitation in a person going to the doctor in the first place, compared to the US, and I'd imagine that has some positive impact on the population. Perhaps there is a tradeoff between treatment of complex conditions, and treatment of more frequent but less complex conditions?
- nonbel 8y ago
  Nah, you just have to go elsewhere because the US healthcare system apparently includes a bunch of unnecessary or overpriced expenses. Or you just say you dont have insurance so you get charged at 10-50% the "chargemaster" price. Think about how cuba is able to have similar life expectancy, etc at a fraction of the cost with chronic shortages and subpar sanitation. Most likely there are many medical procedures doing at best nothing for the patient except draining their wallets. Worse, it could be that treatment 1 for problem A causes problem B which leads to treatment 2, etc, etc for some moderate benefit at great cost over just dealing with problem A. Worst, it could be the medical treatments are having a net negative effect on people's health. Eg, those studies that estimate hospital errors (not even just death from dangerous treatments applied as standard) are the third leading cause of death in the US.
  - castlecrasher2 8y ago
    > Think about how cuba is able to have similar life expectancy, etc at a fraction of the cost with chronic shortages and subpar sanitation. I suspect most of the US' problems is the atrocious lifestyle most live; overeating and under-exercising are literally a lethal combination.
    - nonbel 8y ago
      Well the overeating is partially the healthcare industry's fault due to poor nutritional recommendations. People in general should not have grains as the main basis for their diet. This type of diet makes many people eat more than they otherwise would. I would post a pubmed link but sorry, youll have to just try it yourself and read blogs because the medical researchers still haven't caught up to this. They are still calling a 30% carb diet "low carb".
- TearsInTheRain 8y ago
  Why is that nuts? Honestly it seems kind of nuts that someone would expect another person to pick up their tab
  - TaylorAlexander 8y ago
    I honestly feel like it’s nuts that we don’t collectively fund healthcare, precisely because I don’t want to live in a world where I may be ruined by an illness and I am willing to pay to make sure others don’t have to live in that world. However I am specifically a proponent of voluntary collectives for things, as government forced cooperation seems suboptimal and fragile to me.
    - gascan 8y ago
      Aren't these two things mutually incompatible? How do you have universal healthcare that doesn't let anyone be bankrupted by their illness, where participation is also voluntary? And isn't voluntary collective healthcare just another way to describe private insurance companies, especially HMO's?
      - zaarn 8y ago
        Well, with universal and mandatory healthcare you wouldn't be bankrupted by your illness since the insurance covers it. The population at large pays for the few that need the expensive treatments.
    - AnthonyMouse 8y ago
      > I honestly feel like it’s nuts that we don’t collectively fund healthcare, precisely because I don’t want to live in a world where I may be ruined by an illness and I am willing to pay to make sure others don’t have to live in that world. Isn't this the exact thing insurance solves, in particular catastrophic coverage insurance? Nobody really gets "ruined" by paying out of pocket for one X-ray and two aspirin. The problem is that the insurance is so expensive some people can't afford it. But the only sense in which single payer would "fix" the high cost/overhead/waste problem is by de facto regulating prices, which can be done even without it but which has a lot of obvious problems -- if the regulator chooses too high a price then it's still wasteful/unaffordable but too low and there will be no providers (or the providers will sacrifice quality to hit the regulated price). What we need is a real solution to cost disease, which probably has something to do with reducing the regulatory compliance costs so there will be less overhead and more viable competing providers, requiring price transparency from providers, and then having people pay out of pocket for all non-catastrophic care so the patient has the incentive to decline treatment or find a less expensive provider when the treatment is unnecessary or overpriced.
- cliffordthedog 8y ago
  Nah, you can also just die.

iamaelephant 8y ago

Why is it bananas that you can't just walk away from a debt? The foreclosure system in USA is a significant part of what caused the mortgage crisis.

headmelted 8y ago
You should absolutely be able to walk away from a debt. If I'm a bank, and you come to me for a $75k mortgage on a $100k house, the $25k down is my security. That should be the beginning and end of our transaction. If you stop paying the mortgage, the bank gets the house. If the bank reasonably believed there was a chance of the house being worth less than the amount borrowed during the term, they shouldn't have made the deal. It's a simple system that makes perfect sense. Holding people to account beyond the security, as they do in the UK, encourages predatory lending behaviours and is utterly unfair to the borrower.
- sobani 8y ago
  In other countries (for example the Netherlands) YOU take the loan, not your house. To make sure the bank won't be left holding the bag, you use the house you're about to buy as collateral. In the occasion you stop paying, the bank will foreclose the house, but YOU are still liable for the rest of the loan. If you still don't pay, an official collection agency (not your bank, that would be a conflict of interest) will try to cut a deal, come and take your stuff and/or garnish your wages to pay of the loan. You can insure yourself against calamities like divorce and losing your job, for which the bank will give you a discount on the interest rate. Mortgages are limited by what you can afford, so a predatory mortgage loan is practically an oxymoron. Down payments are uncommon, especially for a first time buyer. The only money you need to bring with you is transaction costs (~5% : taxes, notary, financial advisor, etc.) and whatever you think you need for decorating.

ACow_Adonis 8y ago

It's almost as though both you and the lender should think deeply, be conservative, and do your homework before taking out something as large as a mortgage!

headmelted 8y ago
Let's not pull at that thread. I've tried to convince people for years that the biggest cause of the 2008 crash wasn't the banks, it was the rating agencies, but that's more complicated than people want to get with it. It's a lot easier to just believe that "the system" is "rigged" and "out to get you". In the UK, people should've known they couldn't repay their mortgage if they got in trouble, and it's why I continued renting until 2013. In the US, I'd have happily bought a house with 0% down and no obligation if it goes against me.