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Shame on your realtor and shame on any lender who would have loaned you that much. We saw first-hand people get qualified in to homes they had absolutely no business getting approved for in the first place.
The blame goes all the way around the table...borrowers, lenders, realtors, appraisers.
We are noticing creative lending again, so I guess we learned nothing from 2008.
There is nothing remotely close to the programs that dominated the market from 03-08. Some standards have loosened, but nothing like it was then.
Ok, let's say that's true. This forced Citi to make high risk loans to these people. You think this alone PIONEERED the housing crisis? Back in 2008, I got qualified to buy a home. I was young, with a modest income, but you should've seen how hard my realtor and bank tried to convince me I could and SHOULD buy a $900k home on a $50k salary.That is what caused the crisis... not an isolated case.
it was the government that cause that
me too...and yes a majority of the blame does go to the consumer and the seller too
fact the liberals changed the rules to MANIPULATE that more people bought home.. making it EASIER to get homes...causing housing to skyrocket
sellers wanted TOP dollar..even if it was UNREASONABLE
buyers had EASY CREDIT and LOWINTEREST LOANS with NO DOCUMANTATION to back it up...ie no- doc or low doc loans...to whom...the poor and self employed
what is the NORMAL yearly inflation rates for home...about 5% a year, so that a house will double in 20 years...what we got..houses tripled in less than 10 years
it was the government and the stupid buyers, with the greed of the sellers and their agents
anyone going to buy a home, SHOULD know what they can afford...ie if you make 50k..the TOP house would be 200k...not a 700k house
anyone buying a house SHOULD know that a mortgage payment is not just the principle and interest...but ALSO the HOI(home owners insurance) and the PROPERTY TAXES
anyone buying a house (or anything else on credit) SHOULD KNOW that an ADJUSTABLE RATE ..adjusts...and if the CONTRACT says 4% for the first 18 months then it will set to 6%+prime...dud its going to be ATLEAST 9% or more
anyone going for a mortgage SHOULD KNOW that the house is the collateral
when I bought my house in 1995 I was OFFERED a 80/20, a 3 yr ARM,, and a few others to include an interest only...I KNEW what I wanted...a 20 or 30 yr FIXED with no pre-payment penalty
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yep...in 2007 we all felt sorry for the guy on CNN who was crying that he was going to lose his house...until...he said it was a 700k house and he only earned 40k
he never should have bought that house
a good consumer goes in educated
as a local clothing company once said..."an educated consumer is our best customer"
The GSEs (Fannie and Freddie) themselves created the "automated underwriting" systems which they then foisted upon loan originators in the mid-1990s to speed up the underwriting process and approve more loans to low-income and high-risk borrowers, at HUD's behest (to meet the HUD mandates workingclasshero posted). These systems set underwriting standards for the mortgage industry (whether or not the loans were purchased by the GSEs) way too low, and greatly relaxed the underwriting approval process. An independent study of about 1,000 loans found that the same loans were 65% more likely to be approved by the automated processes versus the manual underwriting process.
Had loan originators NOT used the GSEs' automated underwriting system and continued to use manual underwriting instead, that extra 65% of high-risk loans wouldn't have been made.
Agreed, that was all sorts of effed up. Though I did read awhile back that Fannie (and/or Freddie, forgot which) are now very profitable and paying good dividends back to the gov't*. Silver lining?
Shame on your realtor and shame on any lender who would have loaned you that much. We saw first-hand people get qualified in to homes they had absolutely no business getting approved for in the first place.
The blame goes all the way around the table...borrowers, lenders, realtors, appraisers.
We are noticing creative lending again, so I guess we learned nothing from 2008.
Very true... it scared the bejesus out of me. I was just graduating college, looking for a little studio to avoid renting. Came out getting pre-approved for a large SFH! I got spooked from the whole thing.
Agreed, that was all sorts of effed up. Though I did read awhile back that Fannie (and/or Freddie, forgot which) are now very profitable and paying good dividends back to the gov't*. Silver lining?
Paying the US Treasury? Why aren't they paying down the $2 trillion fronted to them by the Federal Reserve?
That's $2 trillion in QE. Created US$ paid to investors to buy F&F's crappy MBS and hold them on the Federal Reserve's balance sheet. $2 trillion artificially injected into the economy, devaluing the US$.
My point was, could Citi know those mortgages would have defaulted based on the applicants' risk? If they had crappy risk *at time of application* and Citi was forced to make the loans... then yes obviously there is something wrong there. But the argument was that these people had the same risk profile as people who were approved *at time of application* and were denied simply based on their race. If THAT is true, then clearly that is unlawful. Citi can't say, "you guys have the same risk profile but I can tell in 5 years you will default because I can tell the future."
Oh come on BicoastalAnn, every company and bank does a risk analysis. Every business does a risk analysis and if the numbers and situation say that the risk is good, I'm going to take the risk and I don't care if your white or black. You know it so stop the crap.
Paying the US Treasury? Why aren't they paying down the $2 trillion fronted to them by the Federal Reserve?
That's $2 trillion in QE. Created US$ paid to investors to buy F&F's crappy MBS and hold them on the Federal Reserve's balance sheet. $2 trillion artificially injected into the economy, devaluing the US$.
When does that $2 trillion get paid back?
Everything helps, even traveling on a government plane. People in expensive housing, people in HCOL and high tax states are cheating the federal coffers out of those funds which is more help. And we need to get more people back to work contributing their dollars to the federal coffers too. Everything helps.
Originally Posted by Sharpydove View Post
Shame on your realtor and shame on any lender who would have loaned you that much. We saw first-hand people get qualified in to homes they had absolutely no business getting approved for in the first place.
The blame goes all the way around the table...borrowers, lenders, realtors, appraisers.
We are noticing creative lending again, so I guess we learned nothing from 2008.
I agree, the blame goes around the table... People wanting more than they could afford (the mentality was everyone "DESERVES" a home), lenders, wanting easy profit. Both taking part in the greed. Yet when it came crashing down the fingers were pointing everywhere else.
Easy terms, easy money in the name of "I am, so therefor I deserve" mentality, increased demand, drove housing prices up and people are still paying the price today. Even people who weren't old enough and had nothing to do with it are also paying a price. It's not much different than the cost of college skyrocketing.
Anytime the government gets involved in the name of "you deserve" or in the name of helping the poor, it always causes more problems and the American citizens who naively go along pay a hefty price.
LOL told ya so. The left is fighting for the tax break for wealthy people who can take a deduction for outrageous state taxes against federal taxes.
you seem to be confusing democratic legislators with "the left."
i reckon in your world there's one large group of people, who all believe the same thing, and they're all under a single banner called "the left."
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