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Through the loan-qualifying process, some buyers, especially first-timers, become aware of the concept of spending only a certain percentage of their income on what is called PITI — principal, interest, taxes and insurance — "maybe 33 percent of income," said Jerome Scarpello, of Leo Mortgage in Ambler, Pa.
The reason that percentage isn't higher is that other expenses will be incurred with homeownership, he said.
The political obsession with homeownership raised homeownership in the short run to an artificial and unsustainable level of 69% by 2006, but failed in the long run to stimulate homeownership at a sustainable level, and in the process government policy turned good renters into bad homeowners, created a housing bubble, waves of foreclosures, and a subsequent housing meltdown and financial crisis.
for some time, presidents and other politicians have seen increasing home ownership as a sort of feather-in-their-caps, so naturally they wanted to encourage such increases in the percentage of Americans owning their own homes.
eventually, they screwed the pooch by allowing/encouraging practices that made homeowners of some people who had no business owning one.
That just about sums it up; Barney Frank's immortal line 'I want to roll the dice as it applies to this housing situation' makes him as complicit as the rest of his Democratic colleagues for the much-predicted housing collapse.
for some time, presidents and other politicians have seen increasing home ownership as a sort of feather-in-their-caps, so naturally they wanted to encourage such increases in the percentage of Americans owning their own homes.
eventually, they screwed the pooch by allowing/encouraging practices that made homeowners of some people who had no business owning one.
The problem was not so much that people "who had no business owning a home" became homeowners, but rather that people had no business owning the home they bought.
Huge difference there.
Many of these were people who were certainly capable of owning some other home - say a tiny home on a tiny lot - but government did not permit those homes to be built and sold, leaving some people with two lousy options: buy a home you can't afford, or buy nothing at all and continue renting.
It was the banks working through the government. Banks MAKE money off you by loaning you money. Then banks can take that mortgage and sell on Wall Street to make even more money.
All the while the home is collateral for the bank.
How is pointing out that a particular law is aimed a particular sub-group race baiting? Oh, that's right, the game is to call everything racist in order to make people ignore the real problem.
How is pointing out that a particular law is aimed a particular sub-group race baiting? Oh, that's right, the game is to call everything racist in order to make people ignore the real problem.
I suggest you look up the definition of race baiting.
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