COMMENTARY | I know that many people have written, blogged, ranted and screamed about high gas prices. Some have even tried to imply that $4.00 a gallon isn't bad, in terms of inflation and historical percent of gas compared to the household budget. Now let me lay down the cold, frightening truth of what today's gas prices are doing by exposing my own ordeal to public scrutiny. I nearly lost my home. And I won't even go into what my mortgage company was doing to hose me.
I bought my home based on standard mortgage lending processes of applying a mortgage of no more than 33 percent of household income. All was fine and gas was running me about $1.25 to $1.50 a gallon, or $25 to $30 a tank to fill up my truck. That equaled $60 to $90 a week, $240 to $360 a month.
At $3.75 a gallon, my truck costs $82.50 a fill up. Two and a half times each week. $206.00 a week. 4 weeks a month, or $824.00. And that is a serious hit to the monthly household budget. My gas bill is nearly as much as my mortgage, and as far as I can tell, that has never happened. Do the math. High gas prices are literally driving people out of their homes. No pun intended of course. When you buy a house and can afford $360 a month for gas, and then gas goes through the roof to $824 a month and your pay has not gone up in years, it just becomes too much. Add just one family emergency and everything falls apart.
So you default on your home, and many others have no choice but to follow suit. Now, I know that many risky loans were made. But far more loans were based on good math. They just never expected to have to pay nearly $1000.00 a month, a third or more of their salary, just to get to work.
Gas is killing the housing and mortgage industry. Period. I'm just glad that my 401(k) plan invests in gas, because the oil companies are making a killing. Again, no pun intended.
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