Poor Innocent Homeowners
I've heard a lot regarding who is to blame for the mess. The owners, the lenders, or federal oversight. Most would agree that the aggregate of all three are to blame, yet homeowners often get a bit of a pass.
I don't get this. Any of the people who claim they were tricked were surely making the largest purchase of their lives. Yet they did not have the time or interest to actually read the document they were signing?
It's tax season, so let's make a comparison. Lets say I hear some guy on the radio advertising how much he can get back from the IRS. Say I paid $6k income tax last year, and got $500 back. I go talk to the guy and he tells me he can get me $4k back instead this year (he keeps 25% of it). So I give him my W2, and no other document and he fills out the paperwork. He gives me the final paperwork to mail in, and I sign it without looking to see why I am getting such an unbelievable return.
When the IRS audits me demanding proof that I donated 2/3rds of my income to charity, I doubt claiming that the slick radio guy tricked me will work and that I already spend the return means I deserver a bailout. But I don't see how this is any different than what many homeowners are claiming.
I don't get this. Any of the people who claim they were tricked were surely making the largest purchase of their lives. Yet they did not have the time or interest to actually read the document they were signing?
It's tax season, so let's make a comparison. Lets say I hear some guy on the radio advertising how much he can get back from the IRS. Say I paid $6k income tax last year, and got $500 back. I go talk to the guy and he tells me he can get me $4k back instead this year (he keeps 25% of it). So I give him my W2, and no other document and he fills out the paperwork. He gives me the final paperwork to mail in, and I sign it without looking to see why I am getting such an unbelievable return.
When the IRS audits me demanding proof that I donated 2/3rds of my income to charity, I doubt claiming that the slick radio guy tricked me will work and that I already spend the return means I deserver a bailout. But I don't see how this is any different than what many homeowners are claiming.
Comments
Real estate agents often portray themselves as helpers, not sharks, and they are supposed to have their client's best interests in mind.
I made the mistake years ago of completely trusting a real estate agent. I know better now, but a lot of homebuyers have been misled and fooled by agents and lenders...Yeah, these homebuyers should have done more research and been better educated , and of course ultimately it's their responsibility, but it seems a little heartless to let the sharks off the hook, almost like blaming the victim. He couldn't help raping her, she was wearing a short dress, it's her fault.
Bubble bloggers.
Victimized? Used? If she was so victimized, why didn't she file the suit weeks after her deal closed? Why did she wait until we were in a confirmed crash?
I'll tell you why, because she was happy with the purchase until recently. johnsgonefishin is right, she is just refusing to take responsibility for her own poor decisions.
The Bank surly did their due diligence checked their income, their Credit record, time on the job...Savings, money in the bank Or did they?....did the bank say to themselves no matter what happens we can't lose...Prices are going up 10% or so a year...It is a $400,000 house we will collect $25,000 a year so every year our investment is payed down and the value of the equity goes up....HOW CAN THEY LOSE....We don't need no down payment and the Feds want us to find ways to get people into new homes..and besides we can sell the loan...
Now the Homeowner is certainly partially at fault for not being more knowledgable about this high finance (and that is exactly what it is) BUT SO IS THE LENDER...
No Homeowner walks away without severe damage to there finincial and emotional health....and the lender may lose a few bucks....THAT IS THE WAY OF THINGS....
Where we disagree ...I don't think the lenders are shady.....and I don't think the average American should be expected to be an Economics major before he buys a house.....The home owner that got in over his head Lost his house and 10 of 1000s in payments....The Bank may or may not lose depending how much they have received in payment and what the house sells for and their cost in selling the house.
The bank is the Finincial Expert....Just like a wall street investor they put their money down and take their chances...
We forget only about 10 % of the Sub Prime Lones have gone bad...The other 90% represent people who may never had a chance to buy their dream home...They took their chance and are winners....
I have some pity for the poor guy that got caught up in circumstances beyond his control and will lose his house and get a ding on his credit....I have no pity for the flippers....and none for the finincial experts in this mess the Banks..