Problem is really the overspending there have been the past years.
People where getting 30 years mortgages with a 5 year arm paying interest only so they could afford more hoping they would make more in 5 years to pay it. If not they could always refinance again.
Then people build up credit card debt of 20K easily and make just the minimum payments. That 20K still mean they are paying 3000-4000 / year in interest alone, to pay it off they'd need to pay 7-8K / year and that would hardly pay it off in 5 years
On top of that add financed cars, you gotta have 2 or sometimes 3 and then all the rest of the car related cost and you are looking at another 7K - 9K / year
Add health insurance 5K / year, after-school activities 3K /year per kid.
Those things alone is easily 20K+ / year in costs.
To that add another 10-12K / year for rent / mortgages.
Now it's 30K+ and there is no food / clothe or other recreational items included to this calculation.
People like that have no way of getting out of their Credit card debt.
This calculation must be wrong somehow ?
