Know what I hate most about this time of year? The completely STUPID things that candidates will say to try and get votes/attention. For example, the topic of interest at the moment is the meltdown in the sub-prime mortgage market. From the Economist:
Turning up the populist rhetoric, Hillary Clinton has promised to clamp down on “unscrupulous brokers” and wants to give $1 billion to states to help homeowners avoid losing the roof over their heads. John Edwards would produce legislation to regulate “predatory” mortgage lenders and ensure borrowers only receive loans they can afford. Earlier this year Barack Obama called for a “homeowners preservation summit”.
What I'm confused about is why the broker is getting blamed for you not paying your mortgage? Is it their fault you borrowed too much? Or that the housing market fell?
The broker gains nothing if you default. Most brokers resell your loan to other institutions so they have no interest one way or another if you default. By the time you do most don't even own your loan anymore.
Even if they did, I'm still confused why they are "predatory" if they lend you more than you can afford. Isn't it YOUR job to figure out what you can afford? The brokers job is to try and get you a good rate on the amount you want to borrow. Its not to tell you how much to borrow. That's your job!
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Though I can't speak for business practices of the mortgage lending industry (It's simply not my business) there is definite opportunity for a broker to be careless in lending situations.
You said that the broker gains nothing when the borrower defaults. Very true! In fact because he already sold the loan to a bank, he gets off scott-free even though he initiated the bad deal in the first place. He's got his commission already so what does he care?
Who loses out here? The banks that take the loan and the homeowner Joe Schmoe both for obvious reasons. But as you said before, in the end, it was their own damn fault! Blame the Borrowers for not reading the fine print, blame the lenders for agreeing to loan out the money in the first place, blame the fed for keeping interest rates too low for far too long, blame even Robert Kiyosaki who I do believe is responsible for all this crap we're seeing now!
But wait! Because it's fashionable to blame the corporation and corporations can't vote, the politicians think they can buy votes by promising a bail-out under the pretense that it was all the lender's fault in the first place for holding your hand to the pen while they scribbled your name into a bum deal that they knew as well as the buyer did that it was incredibly risky.
Do I feel bad that people are getting screwed? Yes, because in the end, it's gonna be me and the people who saved their pennies that are gonna end up getting screwed for this. In other words, from the rhetoric that I'm hearing, I'm gonna get royally screwed. I shoulda been flipping houses like everyone else instead of paying my own debts and living responsibly.
I hate election time because all of the candidates are liars and no one that is running for president should actually be president. It is the good people out there that can't afford to be president that should be president.
We should do what the damn republicans keep yapping about doing, go back to the way things were at the founding of our country. Washington did not want to be president but everyone thought he was a good and true leader so they made him president and he was the best one we ever had.
Thats y u should all vote for me for President on your ballots. I am with the Blue party (it's Kasia by the way hello guys!!) You can check out the beginnings of my political tirade and stances on my page: ilovemesomekasia.blogspot.com
Have a good day!!!
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