That’s a sales pitch that only works for those who don’t think about it. I have thought about it, so I made them think about it.

I asked a simple question: “what’s the payoff time? how long would it take for the new windows to pay for themselves?”

Well, they tried to duck the question. “That’d be a great question for our consultants…”

I interrupted: “Do you have a ballpark estimate?”

“No.”

“Tell your consultants to send you out with a ballpark next time and I might be willing to talk.” I didn’t let them leave me a flyer either.

I’ve done the math on this before. My gas / electric bill is $170 a month. Installing new windows throughout the entire house will cost us between $2500 and $7000, depending on the make, model, and installer. It’s a simple problem of division. Assuming their windows were miracle windows and eliminated my entire energy bill (hah!), it would take between 15 and 41 years for my new windows to pay for themselves.

There are many good reasons to install new windows. Energy efficiency is not one of them. Not even close.

The New York Times describes a couple who bought “a modest home at the southern end of Silicon Valley”. Now they’re suing their broker and real estate agent for setting them up with a third loan that they didn’t even know they had. They may well have a valid complaint — from the facts presented in the article, the agent was playing both the lender and the buyer for suckers.

But that’s not the part of the story I’m interested in. I’m interested in how much house this couple tried to buy. Here a few facts, hidden throughout the story.

First — how much did their house cost? This is never directly mentioned in the article. It’s buried beneath a photo caption.

Sarai Torralba, 5, riding by the home that her family bought for $595,000 in San Jose, Calif. Prospero and Cirila Torralba borrowed almost $610,000 for it.

Second — how much does this family make? The article never actually says. I would have thought that a key piece of information. The article does mention the Hernandez family, who only earns “about $4,000 a month”, or $48,000 a year. We’ll assume that the Torralba’s are in a similar situation.

Third — how were these loans set up?

The first and biggest loan was a pay-option adjustable rate mortgage. The loan allows borrowers to pay less than the interest due, adding the difference onto the balance so more is owed with each passing month. The interest rate on the loans from Mr. Curiel was 10 percent, with a 15 percent upfront fee added to the principal balance. That loan called for borrowers to make interest-only payments and pay off the full amount in two years.

The loan from Mr. Curiel is the one that the owners are suing over. Still, what’s with the pay-option adjustable rate mortgage? I’d think that simply considering such a loan for 5-10 minutes would convince me that having the loan get bigger month after month was a really bad idea.

Reading these stories, I’m convinced that these buyers were trying to buy something that they knew they couldn’t afford. Rather than having enough of a backbone to say “no” to pushy agents and brokers, they allowed themselves to be talked into obviously bad loan ideas.

Again, lack of resources isn’t a truly valid complaint. Internet site after internet site explains what the various loans mean and what the amortization schedules are. Even having a poor command of English isn’t really a complaint. After all, you are the person signing on the line. It’s your responsibility to find someone that you trust, with a good command of English, to go over the loan terms with you. Otherwise — don’t sign.

Though vowing to fight, Mr. Hernandez said his family’s hopes and goals have been dashed. They came to the United States from Mexico nearly three decades ago. Over the years, he and his wife have worked in agriculture, picking cherries, apples and asparagus. They had three sons here — two have their own families, and one son, 17, still lives with them.

They doubt they will be able to pay for him to go to college, as they had planned.

The Hernandez family was trying to buy a $745,000 house. Whether or not their mortgage was a good one, I’m not sure how you afford college at all with a three-quarter million dollar loan of any sort.

Although an apparently crooked agent was involved, I think greed ultimately did these families in.

He described this summer’s subprime lending crisis as a case study of greed among mortgage lenders and the agencies that provide information about them. …

Well, that’s certainly one way to describe what’s happening in the housing market. But I don’t think it’s very honest. As I’ve said before, I don’t see how giving mortgages to people who are unable to afford them, then going bankrupt when they default on the loan, qualifies as greed.

Instead, I prefer to consider Hanlon’s Razor: “Never attribute to malice that which can be adequately explained by stupidity.”

Stupidity, sure. Giving money to people who can’t give it back is about as far from greed or theft as a business can possibly get.

However, I’ll be happy to accuse home buyers of greed. What would you call it when someone earning $40,000 a year decides to buy a home costing $200,000 or $250,000? Many of the families now defaulting on their loans were looking to get in on a “hot” housing market that had the potential to double or triple the value of houses in the area. They saw cheap money and jumped at the opportunity to get rich.

That’s why I’m convinced that this won’t do any good:

Mr. Obama of Illinois called for regulatory efforts to increase transparency and accountability among financial companies. Mr. Obama zeroed in on the housing market, proposing tighter federal rules on mortgage fraud and government rating systems for mortgages and credit cards.

“If more Americans were armed with this kind of information before they purchased risky mortgage loans,” he said, “the current crisis might not have happened.”

If Senator Obama really believes that, he’s delusional. We were buried in paperwork when we bought our house. We had to sign sheet after sheet of paper, giving us all of the details about our mortgage. Our Realtor and mortgage banker answered all of our questions, throughout the entire process. Even if they hadn’t, website after website offered comprehensive information about every different type of mortgage. Americans had plenty of opportunity to arm themselves with whatever information they needed.

The housing meltdown happened because everyone involved believe that the market would continue to go up forever. Consumers got greedy and banks began taking irresponsible risks thanks to easy money. This “crisis” can’t be blamed on any one group and I’ll not respect anyone that tries to do so.

The local residential real estate market is showing signs of recovery, a local real estate official says.

The 604 sales reported in April in Dane County were 11.4 percent below the 682 last April, according to statistics released Thursday by the Realtors Association of South Central Wisconsin.

But that is not as bad as the 20.1 percent decline for the first four months of this year compared to the same period of last year — 1,802 to 2,006.

And RASCW Executive Director John Deininger said sales this year have improved more than they typically do as the weather warms — by 8.0 percent from January to February, 47.0 percent from February to March, and 23.6 percent from March to April.

Today, borrowing against equity in real estate occurs at rates never seen before. Mortgage equity withdrawal was unheard of generations ago – a second mortgage was the last recourse for a family in trouble.

Today it is routine.

Septuagenarians shake their heads as they see young people living lifestyles which don’t square with what they know of their incomes and expenses. Debt it seems has not taught any hard lessons lately – debt has become too friendly, too tame, and too forgiving.

In the last three years alone, nearly three trillion dollars of new mortgage credit has been extended – first mortgages, second mortgages, home equity loans, and lines of credit.

Some dismiss concerns of too much debt by pointing to the bottom line.

Debt, they say, is not a problem because household balance sheets are the best they’ve ever been. Today, household net worth does look impressive – against a meager 12 trillion dollars in debt stands a hefty 64 trillion dollars in assets.

A closer look at net worth, however, shows that while liabilities have marched steadily upward, assets can go up or down

What happens if real estate assets suffer the same fate as equities did a few years ago? Or, what if real estate values simply go flat for an extended period of time?