Foreclosures continue to occur at a rapid clip, and one could say the housing market is still depressed. It’s a great time to buy; a horrible time to sell.Who’s at fault here?
It’s easy to point fingers at the banks. They are offering loans to people who they know will likely default, and when the inevitable occurs, they heartlessly pursue repossession.
Then again, it was the social engineers of the ‘90s who demanded that banks drop normal business practices and approve loans to those who normally shouldn’t receive them. This was another example of well-meaning liberal policies leading to ruin and despair. Unintended consequences, indeed.
But neither the banks nor policy-makers deserve the blame here …… those who pursued these loans are at fault.
Buying more than one can afford is never a good thing, and people bear the responsibility to know better. Balloon loans and interest-only notes are to be avoided, and no one forced anyone to sign those deals. The culprit can be best spied in the mirror.
It’s just like your mama always said: “if everyone else is jumping off the cliff, it doesn’t mean you have to”. Or something like that …
1 comment:
Sure people took loans that were unwise. But it was Wall Street who repackaged those loans and leveraged them again and again, having them rated triple-A when they knew the underlying mortgages were shaky. It was the collapse of billions of $$ of compounded leverage that brought the economy to its knees. In any normal world that would be called fraud. There is plenty of blame to go around, but the banks deserve their share.
Post a Comment