I've seen mortgages given to nonspeaking English people, probably nonreading English, and questionable literacy of their native language.
This is a good point. But it must be applied only on a case-by-case basis. It cannot be generalized to all lenders.
Consumers takes some of the blame.
This, too, is a good point. To blame the mortgage crisis on only the “greed” of “predatory” lenders is to look at only one side of a two–sided coin. Greed is an affliction that is distributed evenly among all humans, regardless of whether they are lenders OR borrowers. It is short sighted and small minded to suggest otherwise.
President Obama spoke of “predatory lending.” But how can lending be predatory which is not usurious? It cannot. No one forced the virtually cost-free loans upon the borrowers. They took the loans in hope of gain. The banks made the loans in hope of gain. Is either side greedy? The actions of the banks may have been ambitious, but what, otherwise, is the nature of a business? And the borrowers’ desire to get the best possible terms at the lowest cost, had the market not failed, would have been hailed as genius. It is disingenuous, then, that the borrowers, having lost, are championed by those who enjoy identifying them as victims.
(Imagine two golfers. One suggests an unusually big bet on one hole. The other accepts. The first man wins, and the loser explains: “I thought you were just kidding.” Well, perhaps he did, and perhaps he did not, but the question is not what he thought, but would he [having accepted the bet, kidding or not] have accepted the money had he won? Had the housing market continued to rise, would the borrowers have accepted the gain? Of course. As would you and I. How, then, can the loans be called “predatory lending?” Only by suggesting the borrowers’ incapacity to form a legal contract. On what basis?)
That the borrowers lost is unfortunate. But had they won they would have taxed the next buyers with the increase in their property’s value, rewarding and applauding themselves not only for their foresight but for the bravery of their investment.
- David Mamet, The Secret Knowledge On the Dismantling of American Culture (pp. 119-120)
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It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.” – Mark Twain
You're absolutely correct. Consumers takes some of the blame. If the blame was just one sided, we wouldn't need the "shared" pain of a bad economy.
One of the reasons for culpability is that people wanted wanted to make money. W's tax cuts to the wealthy wasn't trickling down, nd houses seem to be the better bet after the dotcom/equity bust of 2000. Here we were, middle age boomer, kids near college age, small amount of savings, and the good life was in the 60's-70's. Wages stagnant, and the new technology jobs became obsolete faster than the jobs in technology was being created.
Being one who was selling these loans I can tell you first-hand that they (regardless of ethnicity) didn't want to hear the real fees. They were more than happy to be lied to. Lost a lot of loans because I was honest and fielded a lot of calls after the fact from folks claiming they're had been mislead. No kidding? I told you that up front and you didn't care. You're screwed and you aided in the process. The consumers were culpable as well. Very few innocents in that process.
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Don't make someone in your life a priority when they've made you an option!
In the last bubble, I've seen mortgages given to nonspeaking English people, probably nonreading English, and questionable literacy of their native language. The penalty should be severely placed on the lender and broker. IMO, the lender/broker were theives and bordered on being unAmerican and subversive.
