puppetmaker (![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png)
puppetmaker) wrote2008-04-13 10:40 am
puppetmaker) wrote2008-04-13 10:40 am
Blame the Homeowner for this loan mess? NO!
Now the homeowners who have the sub-prime mortgages are being blamed for taking on more debt than they could pay. They should have known better. They are bad people for not being able to pay for their houses.
I don't blame a majority of them. (I can't say all because I am sure there were a few that did this to cheat others out of money.) Consider what we saw on TV before the mortgage crash. The commercials aired that told people that they too could be a homeowner and part of the American Dream. They could be real estate moguls and retire early. I constantly hear these both on TV and on the radio. People who thought that they would never own their own home were given a chance to do so. People were talking out second mortgages to pay for their kids to go to college and other things because it was so easy to do. We also have programs like "flip this house" where we are shown that you can take a home and add some money and sweat equity to it and then sell it at an absurd profit. You could make money was the cry.
Home ownership is important to people in America. Owning a piece of land, I was told from an early age, shows that you have made it. Owning a home meant that you had a freedom that renters didn't have and you had something valuable down the road you could use as an asset. And it is a siren song that is played over and over again.
I think we are going to find out a lot more about how banks worked the system to their advantage to make huge profits for their stockholders. I also think there are going to be some serious revisions as to how people applying for credit are assessed. This is going to be bad for many people who were about at the point that they could buy a home or a new car or some other large purchase. But I think in the long term this might be exactly what needs to happen to make sure we don't stay in recession longer than we have to.
I also think we need to look at the people who pushed these loans that are now causing the problems with the banking system. We also need to take a serious look at the people behind them who convinced the brokers that this was the way to go. The brokers got their cut and screw the customer. It was no longer their problem. There was a nudge nudge wink wink about these sub-prime loans. We are finding more and more that paper work was incorrectly filled out or changed slightly because it would help the customer secure the loan. And of course these customers were told don't worry because everyone is doing it.
Then there are the renters who are caught in this mess without doing anything but pay the rent to the landlord. They entered into a contract for their living space only to find that the landlord has been put into foreclosure by the bank and they have less than a week to find somewhere else to live. I feel sorriest for these people. The ones who did everything by the book only to find themselves on the street.
The banks and lending institutions needs to stop this campaign of that it was upon the customer to make sure they could afford the loan. The problem is within the loan system itself when some idiot found a loophole in the federal regulations that allowed them to create this system that has now collapsed. They did it to themselves and rather than the government bailing out the banks, they should be bailing out the taxpayers who entered into these Faustian deals in good faith.
I am grateful that we have a fixed rate on our mortgage.
I don't blame a majority of them. (I can't say all because I am sure there were a few that did this to cheat others out of money.) Consider what we saw on TV before the mortgage crash. The commercials aired that told people that they too could be a homeowner and part of the American Dream. They could be real estate moguls and retire early. I constantly hear these both on TV and on the radio. People who thought that they would never own their own home were given a chance to do so. People were talking out second mortgages to pay for their kids to go to college and other things because it was so easy to do. We also have programs like "flip this house" where we are shown that you can take a home and add some money and sweat equity to it and then sell it at an absurd profit. You could make money was the cry.
Home ownership is important to people in America. Owning a piece of land, I was told from an early age, shows that you have made it. Owning a home meant that you had a freedom that renters didn't have and you had something valuable down the road you could use as an asset. And it is a siren song that is played over and over again.
I think we are going to find out a lot more about how banks worked the system to their advantage to make huge profits for their stockholders. I also think there are going to be some serious revisions as to how people applying for credit are assessed. This is going to be bad for many people who were about at the point that they could buy a home or a new car or some other large purchase. But I think in the long term this might be exactly what needs to happen to make sure we don't stay in recession longer than we have to.
I also think we need to look at the people who pushed these loans that are now causing the problems with the banking system. We also need to take a serious look at the people behind them who convinced the brokers that this was the way to go. The brokers got their cut and screw the customer. It was no longer their problem. There was a nudge nudge wink wink about these sub-prime loans. We are finding more and more that paper work was incorrectly filled out or changed slightly because it would help the customer secure the loan. And of course these customers were told don't worry because everyone is doing it.
Then there are the renters who are caught in this mess without doing anything but pay the rent to the landlord. They entered into a contract for their living space only to find that the landlord has been put into foreclosure by the bank and they have less than a week to find somewhere else to live. I feel sorriest for these people. The ones who did everything by the book only to find themselves on the street.
The banks and lending institutions needs to stop this campaign of that it was upon the customer to make sure they could afford the loan. The problem is within the loan system itself when some idiot found a loophole in the federal regulations that allowed them to create this system that has now collapsed. They did it to themselves and rather than the government bailing out the banks, they should be bailing out the taxpayers who entered into these Faustian deals in good faith.
I am grateful that we have a fixed rate on our mortgage.
no subject
People can't resist a bargain, especially people who are desperate to have an actual house. That is/was the danger of subprime. People went blindly into them not realizing what the effects would be. Conversely, they were never told about them either.
I thank heaven that my house is already paid off. Oh, I'll bitch and whine about the property tax, but it sure beats having to pay the same amount every month.
no subject
Yep. Property taxes are a pain but they are part of home ownership. *grin*
no subject