The economy and real estate

I have been reading a lot on this economic crisis we are experiencing, and it is making me even more angry about the taxpayers paying for this mess. The problem is pretty simple, actually—too many people were getting mortgages from lenders who didn’t seem to care whether they paid it back or not. Because housing values were increasing at phenomenal rates, the banker didn’t worry about the buyer making payments. Even if the buyer defaulted, the bank would still make money on the foreclosure sale. I have handled hundreds of real estate transactions since 1996, so I have been on the frontlines of the subprime mortgage fiasco that has brought Wall Street to its knees. I remember many first-time homebuyers with suspect credit walking out of closings with several thousands of dollars in hand—with no investment at all on their part. Down payment required? No, that’s just too harsh… I even handled loans involving mobile homes with appraised values of over $125,000.00. We know mobile homes in the South, and if there is one that costs that much, it better also function as a motor home and a portable swimming pool. Needless to say, those trailers do not fetch that much at the forced sales on the courthouse steps.

Where will this all end? I have no idea, but I hope the changes don’t freeze lending altogether. That would truly be catastrophic. It burns me up that those of us who struggled to keep paying our mortgages are going have to pay for the ones who were reckless in their finances. That’s grossly unfair, and Washington may be looking at a taxpayer revolt as this progresses.