hk wrote:
Eisboch wrote:

"BAR" wrote in message
...


Those with their arms out-stretched, palms up waiting for Uncle Sam
to drop a couple of pieces of government cheese in their hand.


It's hard for many to accept the fact that the primary reason for the
housing meltdown (sparking the general economic meltdown) had it's
roots back in the mid 1990's.

A well intentioned but flawed social objective to make home ownership
available to more people began the practice of sub-prime mortgage
lending. Banks don't take risks, so the only way to encourage their
participation was to provide them a safety net for these risky loans.
Enter Freddie Mac and Fannie Mae.

The rest is history. It's not all Bush's fault just as it's not all
Clinton's fault. It *is* however a reflection of a more liberal
viewpoint, i.e. "creating" artificial opportunities via government
intervention. It may sound hard and cruel, but if you don't work,
can't work or don't make enough to afford it, you shouldn't be
encouraged to buy it. But many were, and now everybody pays.

"Equal Opportunity Lender" shouldn't mean loans for everybody
regardless of your ability to repay. Ironically, those who so
strongly favored what became sub-prime lending now are screeching the
loudest about government oversight and a return to tougher lending
practices.

Now I'll get the usual "I've got mine, so screw you" comments, but
that's not how I feel.
I really feel badly for those who became trapped in this phony
economics, particularly those who sincerely thought it was an
opportunity that they would otherwise not have. Unfortunately there
are also many who realized, "screw it, what do I have to lose?"

Eisboch


I think you are overstating the social engineering part here, and not
even mentioning the major causative effect, the greed of lending
institutions and their co-conspirators on wall street.

The social engineering part was the primary driver of Congress' threat
to the lending industry to make more loans to those who were marginally
qualified, unqualified and completely and totally unqualified. This
opened up lending to those who couldn't handle their own finances across
the entire spectrum of haves and have nots.

Keep in mind that since WW II this country has promoted low-cost lending
methods to help lower income households buy a home. I'm sure you recall
practically nothing down VA loans and minimimal down FHA loans. By thge
standards of those days, many of those loans were "sub prime."

Within the last 20 years the lending market was cracked open wide, very
wide and just about anybody who was breathing and had a pay stub was
getting a lone whether they were getting a pay stub next week or not.

Risk analysis was thrown out the window with the Congress opening the
window and holding one side of the manual.

The packaging, selling, repackaging and reselling of the more recent
"subprime" loans was a major factor in the recent financial downturn,
along with the greed of all the others who were players. I see what
happened more as a result of unregulated markets than expanding housing
opportunities to lower income buyers.

The banks were stupid, they wanted as many of these loans off of their
books as possible. But, then they saw that others were making buckets of
money from these "packaged" sub prime loans and they started to get in
on the act.

20% cash down. If you don't have 20% down get a second job. If you have
to wait 15 or 20 years to buy a hose then that is what you have to do.
You do not have a right to buy a house regardless what Barney Frank or
Chris Dodd have to say.