As to many of the writers, I hope those that insist that the only cause of this meltdown is individuals lacked personal responsiblity. I those person don’t loose their jobs tomorrow. If they do and they can’t pay their corrupt lender or servicer they will know to look in the mirror and blame themselves, not the employers, or corrupt lenders or corrupt servicers which they had no choice in choosing due to the constant flipping of paper.

Lack of Regulation in the Banking Industry was a major cause of this problem. When consumers apply for a loan it is the bank that tell them what they can afford based on the income that the Lending Institution was supposed to verify so as to determine what loan amount they quailified for. Not everyone who applied for a home loan failed to give accurate information, nor failed to have the homes inspected, or spent their funds faster than the money was printed.

When the OTS cited many Banks for violating servicing standards by failing to apply escrow funds correctly, by billing illegal junk fees. The bank or servicer or MERS is the predator not the consumer.

The whole concept of MBS is a ponzi scam. Homes are not investments like stock, they are where you raise your family. If you want to invest purchase stocks not homes or securities in homes.
The Feds needs to end the non regulatory attitude concerning the lending institutions whether it is a bank or credit card company. Courts should require all Banks filing a forclosue to show the original note to the court at the time of filing.
Trustees should have to identify the holder of the MBS on the court documents.

It is easy to blame the homeowner, until you loose your job, or are severly injured in an accident and your lifestyle is forced to change because of chance, not because of lack of responsiblity!

some of us do but get dragged into a non-issue and end up defending something that was never said and accused of some sort of revival love-fest.

I think you pretty much covered the responsibility issue and the financial end of things was covered on this and many of the other blog tag lines.

When the facts are presented it seems it becomes an attack board with threats and bad analogies.

I agree some have pontificated with no solutions offered. I would be interested to hear an end game from those who feel the borrowers were scammed. Not “abolish the FED” rhetoric.

It seems to me a bailout is inevitable, I am just not sure what to bet on except the big banks.

Oil is doomed to plummet..just a question of when at this point. Demand destruction seems to be building momentum..all this talk about drilling offshore….i know this is a snowball chance. However the mid east is not so sure of that since we seem to jump into the river with little planning so i believe the Saudis will dump more supply on the market.

I know the chant..inflation..inflation but I see this mainly in food and oil due to their relationship. I am buying things now that are 30-40% less than 6 months ago. (electronics/clothing) Even at the grocery store I have been picking up 2 for 1 the past few months on staple items. I think core is still low based on what is going on but if the funds rate is not brought up by 1-1.5% then we will get a whole lot deeper into worst case predictions.

By the time congress finally gets to their handouts the whole mess may be near the end anyway.

The average Joe didn’t know what was happening here, no one successful in business has gotten where they are without taking some risk. And in borrowing money on a secured note (especially in a non-recourse state like like California) I’m sorry to say that the lender/investor is the real risk taker, the borrower may suffer the consequences of ‘bad credit’ but in most cases they won’t be out any cash.

The banker (blinded by Wall Street and short-sighted profit margins) is still the biggest idiot in the room, regardless of the politics or emotion involved. Unfortunately, the rest of us will collectively pay the price despite our involvement, or lack there of.

Best of luck to you as well.

Of course it does. Many banks will do that when they believe that it makes economic sense to do it. Until then, they will use the “hammer” method on homeowner’s (notice of defaults).

There are ALWAYS bubbles in a capitalistic society. Take a look at commodity prices right now. Real Estate is the same. You purchase a home to live in, and a take a mortgage that is affordable….if you do not, you suffer the consequences.

On the macro level, this is a HUGE mess. Banks should do anything possible to preserve the values of their underlying assets (home prices). Unfortunately, this debt boom has cut a swath through ALL sectors of the economy. I am all for a one-time tax increase for people earning over a certain amount of money provided it only goes to pay down the Federal Deficit. That would help strenthen our dollar. When and if the Deficit evre get’s under control, the Congress and Executive Branches need to adopt a balanced budget amendment that many states have (and the Federal Government USED to have). We are in uncharted waters as a debtor nation, and we are now controlled by the whims of foreign investors. No simple solutions…..I keep hearing on this post: “abolish the FED”…well, for one, that won’t happen, so why waste time floating that idea out there??? We need to have realistic discourse about this problem. I wish you well.

From the cost of your home it appears you are voting to increase your own taxes to better our economy and I applaud your efforts and think you ought to get on a bandwagon and take your idea to Congress.

Additionally, I agree with your statement that many folks took out loans they could not afford. Nevertheless, accepting that fact only aggrevates the problem and leads us no closer to a solution. Hindsight is always 20/20.

i would prefer to continue to get paid…

Nice post about the banks working with the borrowers to muddle our way out of this mess. I agree with that. Does the bank have to: NO. They will only do it if it makes economic sense for them to do it.

You still fail to address the CORE problem. People accepted more debt than they should have. With regard to my stock market comment, I was making a personal statement about what may happen down the road.

Real estate prices don’t always go up…..if you believe that, I have some property for sale in the Everglades. The root problem is that Americans took on too much debt, and now it is time to pay the piper.

P.S. I live in California and purchased a home for 1.6M, in 2003. I completed a remodel, and at the peak of the market, my house was worth probably 2.6M. Now it is worth around 2.2M. Should I blame the bank and my contractor because my property is now worth less??? They should have known that real estate prices were going to go down. That’s what many people on this blog site are doing. They accepted terms on a loan that was TOO EXPENSIVE….NOW, THEY ARE PAYING THE PRICE. THE BANKS ARE PAYING THE PRICE BY ALLOWING UNDERWRITING GUIDELINES TO BECOME TOO LOOSE…..see it all makes sense. Lucky, we live in a society where you can CHOOSE not to buy a home!

some people have answered your questions, you just do not like their answers or alternatives….

Gator

atleast for me- I have learned a lot from everyone, even those whose views differ from mine, it gives me a different perspective on how to see things. but somehow the facts are the facts: yes the borrower signed the note, & yes he is held by contract to pay – but how he was made to sign or other factors involved are a big problem….

I believe that most of us here are trying to find solutions, learn from others mistakes and i for one want to help those that I can. i don’t want to do like lookinthemirror and tell them just sell you house & move on… (besides that is an awful idea especially in a market where the appraised values have dropped below what you owe so how can you sell?) i would rather offer a way to save their homes if they can, different options to mediate with the bank or find an attorney that can review your loan for predatory lending or errors.

Look – lookinthemirror – most people were not born into a family with silver & gold spoons, most people work paycheck to paycheck and by you putting them down & telling them they made huge enormous mistakes – is not going to make it better. All that energy & time you have on your hands, why don’t you focus on finding who is truly responsible for all this corrupted mortgage realestate economic mess that we are all in. because trust me if there are homes in your neighborhood being foreclosed your property valued just dropped too.