Rant on a tangent; subprime loans..... I'm not going to point fingers at loan brokers, or even at the borrowers in trouble. In fact, I point fingers at EVERYONE in the chain of failure; from the high execs to the working-class homeowner-borrower. I do have an opinion that is very clear. There should never have been any "sub prime" loans made. The only reason those loans were made, was through corruption with the lenders, who saw a chance to bilk less qualified people for huge interest. They figured that sooner or later the borrowers might not pay, but they also figured they'd just foreclose, and still make plenty of money. The joke turned on them, however, when the market failed. It was a simple case of a load hitting the saturation point, and now we're all paying for it. If you want to buy a house, you're supposed to live cheap for a few years and PUT MONEY AWAY FOR A BIG DOWN PAYMENT. Not borrow 120% of the home's price, and get no payments for a year while the interest makes the amount owed, rocket into orbit while you're enjoying the "free money". I'm sorry to insult anyone, but those who did that are FOOLS. Would we get under a barbell that we had NO IDEA if we could put back on the hooks without a spotter? That's exactly what all those subprime borrowers did, and the loan companies loaded all the bars blind.
Why are my wife and I not homeless right now? Because we never refinanced anything during all the big craze for "pull cash out of your house, and buy cars, boats, and second homes"... And we live within our means to begin with. Every single day, somebody would pound on the door, or we'd get crap in the mail, or by fax, telling us we could get all kinds of cash. I see exactly how so, SO many people fell into that trap. In fact, we have a friend who did, and she was a loan processor at Countrywide herself. We like her as a good person, so when she lost her condo (which she bought & financed for $500,000 in Ventura County, CA, and is now valued at $105,000), we felt bad and let her have a little rental house at a reduced price. And we bought it in '08 from someone who couldn't pay their subprime loan. What a circuit of fate.....
Charles