A House Built upon the Rock

I know there are few that have investments that are not uneasy about the difficulties financial institutions are going through, and wondering just how much it will effect them. Though the government has stepped in and taken over, or bailed out several, the sad truth is the government has no money just the ability to print it. The only money they have is what they borrow from or tax the citizans of this great country.
For years this great nations financial system has been rock solid using sound principles of money management and investment. If losses came because of poor management or bad decisions , each bore the burdan of that loss, and went on, or went under. People saved a portion of what they earned and made wise investment decisions based on solid financial principles. They built their house on the rock.

I was talking with someone the other day about the financial institutions that are in serious trouble, because they like many of us have borrowed far more than they were earning, and have made poor management decisions in investing that borrowed money in subprime mortage pacakges which have lost value, or are now worthless.

I remembered the first house that my wife and I bought after saving for two years for a down payment. We had saved $2,000 to put down on a $10,500 three bedroom one bath home. We were so excited about moving in to our new home. Then I got a letter from the bank that was handling our loan. They wanted an explination about a $5 bill that had been charged off for non payment. the only derogative note in my credit file. I had to write a letter and a check for $5 to the business where I had made the charge before they would approve my loan. Of course that was in 1960 and things were quite diffrent than today.

The rule then was: house payment including taxes and insurance could not be more than 30% of gross salary. Total loan and closing costs could not be more than 21/2 times gross annual pay.
People on average were saving 6% of family income, and living within their ability to pay.

My how times have changed! a year ago you could buy a house, and finance 100% of the appraised value of the home. Nothing down with an ajustable rate mortage. Then move into the home of your dreams, until the first interest ajustment came, and your payment increased beyond your means to pay. Then that dream becomes a mill stone round your neck.
The bank that gave you the loan is not much better, because they have since sold your mortage to someone else, to free up funds to make other loans.

Have you seen the TV commercial with the guy on his riding lawn mower telling about his 4 bedroom three bath home on the golf couse, with membership in the golf club, two new cars
and a boat in the drive way, He asks "How do I do it"? I'm in debt up to my eyeballs, somebody please help me!

The Bible tells us we should build our house upon the rock a firm foundation. Of course it is talking about our spiritual house, but that same principle applies to our use of the money God has blessed us with.
Our problem as individuals, and as a nation is that we have built our house upon the sand, now the storm has arrived, and the house is falling. Any good builder will tell you that if a house begins to crumble because of a poor foundation, it will do no good to rebuild the house until you fix the foundation which is the real problem.

I hope your house is built on a rock, and that you have made good use of the blessings God has shared with you.