How much money do metal bands/musicians make in a year?

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Nightcrawler

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The Problem With Music
by Steve Albini

Whenever I talk to a band who are about to sign with a major label, I always end up thinking of them in a particular context. I imagine a trench, about four feet wide and five feet deep, maybe sixty yards long, filled with runny, decaying shit. I imagine these people, some of them good friends, some of them barely acquaintances, at one end of this trench. I also imagine a faceless industry lackey at the other end holding a fountain pen and a contract waiting to be signed. Nobody can see what's printed on the contract. It's too far away, and besides, the shit stench is making everybody's eyes water. The lackey shouts to everybody that the first one to swim the trench gets to sign the contract. Everybody dives in the trench and they struggle furiously to get to the other end. Two people arrive simultaneously and begin wrestling furiously, clawing each other and dunking each other under the shit. Eventually, one of them capitulates, and there's only one contestant left. He reaches for the pen, but the Lackey says "Actually, I think you need a little more development. Swim again, please. Backstroke". And he does of course.

Every major label involved in the hunt for new bands now has on staff a high-profile point man, an "A & R" rep who can present a comfortable face to any prospective band. The initials stand for "Artist and Repertoire." because historically, the A & R staff would select artists to record music that they had also selected, out of an available pool of each. This is still the case, though not openly. These guys are universally young [about the same age as the bands being wooed], and nowadays they always have some obvious underground rock credibility flag they can wave.

Lyle Preslar, former guitarist for Minor Threat, is one of them. Terry Tolkin, former NY independent booking agent and assistant manager at Touch and Go is one of them. Al Smith, former soundman at CBGB is one of them. Mike Gitter, former editor of XXX fanzine and contributor to Rip, Kerrang and other lowbrow rags is one of them. Many of the annoying turds who used to staff college radio stations are in their ranks as well. There are several reasons A & R scouts are always young. The explanation usually copped-to is that the scout will be "hip to the current musical "scene." A more important reason is that the bands will intuitively trust someone they think is a peer, and who speaks fondly of the same formative rock and roll experiences. The A & R person is the first person to make contact with the band, and as such is the first person to promise them the moon. Who better to promise them the moon than an idealistic young turk who expects to be calling the shots in a few years, and who has had no previous experience with a big record company. Hell, he's as naive as the band he's duping. When he tells them no one will interfere in their creative process, he probably even believes it. When he sits down with the band for the first time, over a plate of angel hair pasta, he can tell them with all sincerity that when they sign with company X, they're really signing with him and he's on their side. Remember that great gig I saw you at in '85? Didn't we have a blast. By now all rock bands are wise enough to be suspicious of music industry scum. There is a pervasive caricature in popular culture of a portly, middle aged ex-hipster talking a mile-a-minute, using outdated jargon and calling everybody "baby." After meeting "their" A & R guy, the band will say to themselves and everyone else, "He's not like a record company guy at all! He's like one of us." And they will be right. That's one of the reasons he was hired.

These A & R guys are not allowed to write contracts. What they do is present the band with a letter of intent, or "deal memo," which loosely states some terms, and affirms that the band will sign with the label once a contract has been agreed on. The spookiest thing about this harmless sounding little memo, is that it is, for all legal purposes, a binding document. That is, once the band signs it, they are under obligation to conclude a deal with the label. If the label presents them with a contract that the band don't want to sign, all the label has to do is wait. There are a hundred other bands willing to sign the exact same contract, so the label is in a position of strength. These letters never have any terms of expiration, so the band remain bound by the deal memo until a contract is signed, no matter how long that takes. The band cannot sign to another laborer or even put out its own material unless they are released from their agreement, which never happens. Make no mistake about it: once a band has signed a letter of intent, they will either eventually sign a contract that suits the label or they will be destroyed.

One of my favorite bands was held hostage for the better part of two years by a slick young "He's not like a label guy at all," A & R rep, on the basis of such a deal memo. He had failed to come through on any of his promises [something he did with similar effect to another well-known band], and so the band wanted out. Another label expressed interest, but when the A & R man was asked to release the band, he said he would need money or points, or possibly both, before he would consider it. The new label was afraid the price would be too dear, and they said no thanks. On the cusp of making their signature album, an excellent band, humiliated, broke up from the stress and the many months of inactivity. There's this band. They're pretty ordinary, but they're also pretty good, so they've attracted some attention. They're signed to a moderate-sized "independent" label owned by a distribution company, and they have another two albums owed to the label. They're a little ambitious. They'd like to get signed by a major label so they can have some security you know, get some good equipment, tour in a proper tour bus -- nothing fancy, just a little reward for all the hard work. To that end, they got a manager. He knows some of the label guys, and he can shop their next project to all the right people. He takes his cut, sure, but it's only 15%, and if he can get them signed then it's money well spent. Anyways, it doesn't cost them anything if it doesn't work. 15% of nothing isn't much! One day an A & R scout calls them, says he's 'been following them for a while now, and when their manager mentioned them to him, it just "clicked." Would they like to meet with him about the possibility of working out a deal with his label? Wow. Big Break time. They meet the guy, and y'know what -- he's not what they expected from a label guy. He's young and dresses pretty much like the band does. He knows all their favorite bands. He's like one of them. He tells them he wants to go to bat for them, to try to get them everything they want. He says anything is possible with the right attitude.

They conclude the evening by taking home a copy of a deal memo they wrote out and signed on the spot. The A & R guy was full of great ideas, even talked about using a name producer. Butch Vig is out of the question-he wants 100 g's and three points, but they can get Don Fleming for $30,000 plus three points. Even that's a little steep, so maybe they'll go with that guy who used to be in David Letterman's band. He only wants three points. Or they can have just anybody record it (like Warton Tiers, maybe-- cost you 5 or 7 grand] and have Andy Wallace remix it for 4 grand a track plus 2 points. It was a lot to think about. Well, they like this guy and they trust him. Besides, they already signed the deal memo. He must have been serious about wanting them to sign. They break the news to their current label, and the label manager says he wants them to succeed, so they have his blessing. He will need to be compensated, of course, for the remaining albums left on their contract, but he'll work it out with the label himself.

Sub Pop made millions from selling off Nirvana, and Twin Tone hasn't done bad either: 50 grand for the Babes and 60 grand for the Poster Children-- without having to sell a single additional record. It'll be something modest. The new label doesn't mind, so long as it's recoupable out of royalties. Well, they get the final contract, and it's not quite what they expected. They figure it's better to be safe than sorry and they turn it over to a lawyer--one who says he's experienced in entertainment law and he hammers out a few bugs. They're still not sure about it, but the lawyer says he's seen a lot of contracts, and theirs is pretty good. They'll be great royalty: 13% [less a 1O% packaging deduction]. Wasn't it Buffalo Tom that were only getting 12% less 10? Whatever. The old label only wants 50 grand, an no points. Hell, Sub Pop got 3 points when they let Nirvana go. They're signed for four years, with options on each year, for a total of over a million dollars! That's a lot of money in any man's English. The first year's advance alone is $250,000. Just think about it, a quarter million, just for being in a rock band! Their manager thinks it's a great deal, especially the large advance. Besides, he knows a publishing company that will take the band on if they get signed, and even give them an advance of 20 grand, so they'll be making that money too. The manager says publishing is pretty mysterious, and nobody really knows where all the money comes from, but the lawyer can look that contract over too. Hell, it's free money. Their booking agent is excited about the band signing to a major. He says they can maybe average $1,000 or $2,000 a night from now on. That's enough to justify a five week tour, and with tour support, they can use a proper crew, buy some good equipment and even get a tour bus! Buses are pretty expensive, but if you figure in the price of a hotel room for everybody In the band and crew, they're actually about the same cost. Some bands like Therapy? and Sloan and Stereolab use buses on their tours even when they're getting paid only a couple hundred bucks a night, and this tour should earn at least a grand or two every night. It'll be worth it. The band will be more comfortable and will play better.

The agent says a band on a major label can get a merchandising company to pay them an advance on T-shirt sales! ridiculous! There's a gold mine here! The lawyer Should look over the merchandising contract, just to be safe. They get drunk at the signing party. Polaroids are taken and everybody looks thrilled. The label picked them up in a limo. They decided to go with the producer who used to be in Letterman's band. He had these technicians come in and tune the drums for them and tweak their amps and guitars. He had a guy bring in a slew of expensive old "vintage" microphones. Boy, were they "warm." He even had a guy come in and check the phase of all the equipment in the control room! Boy, was he professional. He used a bunch of equipment on them and by the end of it, they all agreed that it sounded very "punchy," yet "warm." All that hard work paid off. With the help of a video, the album went like hotcakes! They sold a quarter million copies! Here is the math that will explain just how fucked they are: These figures are representative of amounts that appear in record contracts daily. There's no need to skew the figures to make the scenario look bad, since real-life examples more than abound. income is bold and underlined, expenses are not.


Advance: $ 250,000
Manager's cut: $ 37,500
Legal fees: $ 10,000
Recording Budget: $ 150,000
Producer's advance: $ 50,000
Studio fee: $ 52,500
Drum Amp, Mic and Phase "Doctors": $ 3,000
Recording tape: $ 8,000
Equipment rental: $ 5,000
Cartage and Transportation: $ 5,000
Lodgings while in studio: $ 10,000
Catering: $ 3,000
Mastering: $ 10,000
Tape copies, reference CDs, shipping tapes, misc. expenses: $ 2,000
Video budget: $ 30,000
Cameras: $ 8,000
Crew: $ 5,000
Processing and transfers: $ 3,000
Off-line: $ 2,000
On-line editing: $ 3,000
Catering: $ 1,000
Stage and construction: $ 3,000
Copies, couriers, transportation: $ 2,000
Director's fee: $ 3,000
Album Artwork: $ 5,000
Promotional photo shoot and duplication: $ 2,000
Band fund: $ 15,000
New fancy professional drum kit: $ 5,000
New fancy professional guitars [2]: $ 3,000
New fancy professional guitar amp rigs [2]: $ 4,000
New fancy potato-shaped bass guitar: $ 1,000
New fancy rack of lights bass amp: $ 1,000
Rehearsal space rental: $ 500
Big blowout party for their friends: $ 500
Tour expense [5 weeks]: $ 50,875
Bus: $ 25,000
Crew [3]: $ 7,500
Food and per diems: $ 7,875
Fuel: $ 3,000
Consumable supplies: $ 3,500
Wardrobe: $ 1,000
Promotion: $ 3,000
Tour gross income: $ 50,000
Agent's cut: $ 7,500
Manager's cut: $ 7,500
Merchandising advance: $ 20,000
Manager's cut: $ 3,000
Lawyer's fee: $ 1,000
Publishing advance: $ 20,000
Manager's cut: $ 3,000
Lawyer's fee: $ 1,000
Record sales: 250,000 @ $12 =
$3,000,000
Gross retail revenue Royalty: [13% of 90% of retail]:
$ 351,000
Less advance: $ 250,000
Producer's points: [3% less $50,000 advance]:
$ 40,000
Promotional budget: $ 25,000
Recoupable buyout from previous label: $ 50,000
Net royalty: $ -14,000
Record company income:

Record wholesale price: $6.50 x 250,000 =
$1,625,000 gross income
Artist Royalties: $ 351,000
Deficit from royalties: $ 14,000
Manufacturing, packaging and distribution: @ $2.20 per record: $ 550,000
Gross profit: $ 7l0,000
The Balance Sheet: This is how much each player got paid at the end of the game.

Record company: $ 710,000
Producer: $ 90,000
Manager: $ 51,000
Studio: $ 52,500
Previous label: $ 50,000
Agent: $ 7,500
Lawyer: $ 12,000
Band member net income each: $ 4,031.25
The band is now 1/4 of the way through its contract, has made the music industry more than 3 million dollars richer, but is in the hole $14,000 on royalties. The band members have each earned about 1/3 as much as they would working at a 7-11, but they got to ride in a tour bus for a month. The next album will be about the same, except that the record company will insist they spend more time and money on it. Since the previous one never "recouped," the band will have no leverage, and will oblige. The next tour will be about the same, except the merchandising advance will have already been paid, and the band, strangely enough, won't have earned any royalties from their T-shirts yet. Maybe the T-shirt guys have figured out how to count money like record company guys. Some of your friends are probably already this fucked.

Steve Albini is an independent and corporate rock record producer most widely known for having produced Nirvana's "In Utero".
 

F1Filter

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I can't believe that venues charge a "merch rate." How fucking stupid is that? :mad:

It's highway robbery. :noway:

Which is why a band I recently saw was hanging out at the merch booth after their set; and was telling everyone that they'd also be selling outside the venue on their bus -or- go to their website.
 

Homebrew1709

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In response to Nightcrawler's post in particular:

This may sound harsh, but I don't really feel bad for bands that aren't doing well financially, especially if they are signed to a major label. If you haven't yet figured out that making a living off being in a band doesn't work 99.99% of the time, then you are just naive and making the same mistake that thousands of bands before you have made. In any other business, you project your sales, expenses, cash flows and perform other miscellaneous due diligence PRIOR to jumping into a deal or business venture. Unfortunately, most bands are too excited or just not sophisticated enough to really think these things through before signing on the dotted line. It's no secret anymore that the artists are at the bottom of the music industry food chain. Even the rich-as-fuck pop stars aren't making poop compared to the execs and directors of their record labels. Do bands get taken advantage of by labels? Perhaps. Is it illegal? No. You, as a band, just need to avoid being the sucker...
 

xshreditupx

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as far as i know the labels are where the money go's.

Its making profit after paying your label fees thats the hard part.

Youd be surprised at the cost of touring. Tourbusses + drivers can cost like $500 a day in some places.

sorry man, but thats way off. my buddies are on warp tour right now, bus, driver and gas 1100 dollars a day. hahaha for real. its hard to make cash, but if you do it right you can make a decent living, ie pay the bills.
 

Cadavuh

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I for one blame the musicians as much as I blame the music industry for these kind of problems. As much as I despise the exploitation of musicians via record labels, managers, etc.. the musicians are the ones who gave these people the control over them in the first place. They put their dirty hands out to us and we naively and ignorantly take them which in turn gives them all the power. In fact I despise musicians bitching about the music business as much as I despise the business itself. If your so hurt by it then go fucking do something about it. Start your own label, build your own studio, print your own CDs...all the knowledge and tools you will ever need are at your disposal.
 

Zugster

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That's kinda like blaming homeowners bitching about banks and mortgages. No doubt some homeowners made bad decisions and bought too much house based on bad assumptions, etc. BUT - it's not like most people can raise the 6 figures of cash to buy a house outright. Mortgages are the only way for most people. Most musicians can't build their own music production and distribution systems from scratch for similar reasons.
 

Lon

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the nirvana producer guy post is totally outdated imho, if i just see 52k$ studio figures i get the rages... you can produce a totally professional sounding album for cheesecakes, i bet with 5$ grand you're in if you have the workforce and skill in the band (and theres no excuse, everybody can learn anything... my calculations are based on professional mixing mastering and drum recording, the rest diy) and to be honest even with a crappy dayjob everyone can shell out 1k$ every 2 years to make a album if youre really invested.

this just makes me realize how much the industry has turned and i didn't even notice it because i just grew up as a musician in the whole "nah just do it ourselves" movement because nobody could shell out money for a studio, hell for the longest time in my live i couldnt even get the mo' for a decent amplifier... just since i have a decent paying job my gear has improved vastly ^^
 

petereanima

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In my opinion this doesn't seem that bad. You just have to learn to live day by day and learn to be as minimalist as humanly possible. It seems to me these bands are living on a day to day income of roughly $25 per member. $15 income + $10 per diem. If budgeted correctly you could have everything you could possibly need on a day to day basis assuming you take the proper measures before going on tour.

And when you get home, you have no place to live, no job, no girlfriend. Awesome deal. :yesway:

You can basically hardly SURVIVE, as long as you are on tour.
 

Dyingsea

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the nirvana producer guy post is totally outdated imho, if i just see 52k$ studio figures i get the rages... you can produce a totally professional sounding album for cheesecakes

That's definitely a larger label studio budget but I disagree. Professional studios aren't cheap by any means and neither are quality engineers. You need to drop into a music industry city sometime and see what a professional studio brings to the table that the "go at it alone way" simply can not. There's some good stuff coming from the home DAW world but a lot of it is also very lacking.
 

MistaMarko

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Most bands laugh at business and music going hand in hand. It's the bands that are "all about the art/music" and all this mess that won't make it. Sure, it's about that, but in the end, you need to have a SOLID, FIRM understanding of business ethics, practices, accounting, intellectual management skills, more advanced marketing strategies and more. Most bands have never even heard of these terms.

Why does Steve Vai, with no vocals and totally instrumental music in the rock/metal world that hardly has a niche, sell twice as many records as bands like Tool, Dream Theater, and more? Simple, he's a good business man.
 

Nightcrawler

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I think the important thing about Steve Albini's post, especially in regards to when it was published (early 90's) is to bring attention to the scum side of the music industry, as it presents all the glamour of it and never the underside. Yes, we've all grown up in the DIY scene and that's how I've put out all my records and have had relative success with them in the indie/underground circuit.

I've played music and toured for quite some time now and have many friends that are doing the same. Unless you get in with a supportive indie label, you're better off doing everything yourself. It's hard to make a buck, especially when there are sharks out there only concerned with making money off you.

Like many people said, be smart about it and realize exactly what this is all about.
 

synrgy

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That's definitely a larger label studio budget but I disagree. Professional studios aren't cheap by any means and neither are quality engineers. You need to drop into a music industry city sometime and see what a professional studio brings to the table that the "go at it alone way" simply can not. There's some good stuff coming from the home DAW world but a lot of it is also very lacking.

Yeah. There's truth to that.

I *love* home recording, and am *amazed* by how far it has come in such a short period of time, but:

No amount of fancy computers, expensive VST plugins and digital interfaces can dream of comparing to a fully treated live recording space, hundreds of thousands of dollars in microphone pre-amps, a massive SSL (or comparable) mixing console and a fully treated treated/isolated referencing room/monitors.

I'm not trying to start any pointless debate. I'm just saying that a laptop with Cubase/Ableton/Logic/etc is simply not the same thing as a professional studio.
 

Homebrew1709

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the nirvana producer guy post is totally outdated imho, if i just see 52k$ studio figures i get the rages... you can produce a totally professional sounding album for cheesecakes, i bet with 5$ grand you're in if you have the workforce and skill in the band (and theres no excuse, everybody can learn anything... my calculations are based on professional mixing mastering and drum recording, the rest diy) and to be honest even with a crappy dayjob everyone can shell out 1k$ every 2 years to make a album if youre really invested.

I agree that it's astronomically easier to make a professional sounding album in 2010 than it was in 1994. But back then, the only way for fans to get their hands on an album was to go to the record store and buy it. It may be cheaper to record, but it's also harder to sell, IMO. Now I'm not gonna go all Metallica here and preach against pirating/free downloading - it should just be pointed out that the music biz has changed a lot with the development of the internet. The pool of musicians and bands is HUGE now and there's so many ways for bands to get their music out there on the internet. The music biz, in basically every genre, is diluted with a million bands that all sound the same. There's SO much more competition among bands because anyone and everyone can get their music out to the public. This is probably a better deal for the listener than it is for the bands. The pie that is the music biz may be slightly bigger, but the slices have become smaller and smaller. Good for the labels, good for the listeners/fans, not so good for the participating musicians.
 

Warchest1

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I wonder the same thing all the time. Like, when theres five bands on a bill playing a venue that holds 500-1000 people? They can't be making much.
 

Cadavuh

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That's kinda like blaming homeowners bitching about banks and mortgages. No doubt some homeowners made bad decisions and bought too much house based on bad assumptions, etc. BUT - it's not like most people can raise the 6 figures of cash to buy a house outright. Mortgages are the only way for most people. Most musicians can't build their own music production and distribution systems from scratch for similar reasons.

Well if they couldn't raise $600k to pay back a loan in a reasonable amount of time, assuming they already had the ability to put in a hefty down-payment, they should be shopping for a cheaper house or not shopping at all. Concerning your second statement, look at Periphery. Their album was home recorded and listen to its quality, its phenomenal. I would say Misha used around $5-6k worth of gear to record it that he had invested in over time, probably over the course of a few years. As for distribution you have digital distribution via iTunes, CD Baby, etc.. that can be set up by the band itself. You can also distribute actual CDs from merch sites or Amazon. I agree that distribution is best done by a label through a distribution company though.





And when you get home, you have no place to live, no job, no girlfriend. Awesome deal. :yesway:

You can basically hardly SURVIVE, as long as you are on tour.

Paraphrasing what I said, you should know what your getting into and know what to expect to get out of it before doing it. The premise of my post was that musicians in a mid-level band(making roughly $25 a day) have the ability to live day by day, easily I might add, on touring income while on tour. Once the tours over though, that's a different story.
 

Evil7

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Why dont we all talk about ways to sway the power back to the musician. Ways for the musicians to take their cut back. What is a fair deal when dealing with a record label, venues, and managers.
Re write the industry with a standard that is fair to musicians. Boycott all other contracts... ect.... Or does this sound outlandish? Musicians have the product to offer that makes the money. Seems as if this is the starting point.

LETS TALK ABOUT SOLUTIONS!
 

Homebrew1709

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Why dont we all talk about ways to sway the power back to the musician. Ways for the musicians to take their cut back. What is a fair deal when dealing with a record label, venues, and managers.
Re write the industry with a standard that is fair to musicians. Boycott all other contracts... ect.... Or does this sound outlandish? Musicians have the product to offer that makes the money. Seems as if this is the starting point.

LETS TALK ABOUT SOLUTIONS!

I think the biggest issue is, as with most business ventures, it requires a pretty large initial capital investment - that's a pretty big negative cash flow before you even begin making a penny. In most cases, you need the financial help of a label the same way small businesses go to banks for loans. Could a band incorporate into, say, an S-Corporation and put together a REAL business plan to present to a small bank in order to receive a loan (or series of loans) to cover the up-front costs of recording, merchandise, transportation, etc...Perform actual bookkeeping like a real business (track sales, expenses, depreciation of gear/assets (if possible), tax savings from interest payments, etc.) People incorporate their crappy lawn mowing and car parking businesses, so why not a band?
 

Zugster

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Well if they couldn't raise $600k to pay back a loan in a reasonable amount of time, assuming they already had the ability to put in a hefty down-payment, they should be shopping for a cheaper house or not shopping at all....

Absolutely false. I know this is a side point but it bears some discussion.

Apparently you know little or nothing about buying houses. I have bought and sold several houses in different parts of the U.S. over a number of years.

First of all I said 6 figures which means anything over $100,000. A typical modest home being in the $150K to $350K depending on costs in the area. (At least these were common prices before the crash in the housing market). No person, or couple, with typical middle means or upper middle class means can put down much more than 20% of the purchase price of a home. They buy that home with a mortgage to cover the other 80% typically or a 30 year period. If their income is such that they can afford these mortgage payments, then this is the totally normal and responsible way to buy a home.

Say a couple with a combined income of $100,000 bought a home for $250K, putting down $50K. They could afford the mortgage payments on the $200K loan, but no way could they somehow come up with that $200K of cash "in a reasonable amount of time." Now say due to the recession, that couple loses their jobs and can't get anything with comparable pay for a year.

They lose their house.

Were they irresponsible? Hell no. Just totally normal and reasonable.

You can verify this by talking to a reputable real estate agent or doing some research yourself.
 
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