Why are we bailing out the banks when consumers were duped into the cruddy loan products the banks sold them...? (At least some of them were "up-sold" the ARM or some other ridiculous loan, perhaps with an inflated Debt/Income ratio as an added bonus?)
Why should businesses be saved when consumers will lose their homes?
The whole mess came about because loans were made that shouldn't have been made... (hundreds of thousands of loans, maybe even millions of them!)
The facts are:
- Buyers should come in with down payment,
- Home prices should be set at an affordable level (by offering sound loans to qualified buyers only) and
- People who can't prove they can pay should pay a higher rate to offset that risk or continue as renters...
And if you look at the crisis and what is naturally coming about in the free market because of it, those exact things are happening. The reason we are in this mess is because banks ignored those basic guidelines.
If the banks had followed sound business practices, we wouldn't be in the mess we are in today.
The long-term answer is to get the banks back to following sound business practices. They basically took on more than they could back up. I know a number of lenders who didn't push these risky mortgages on clients and they are still doing well.
I don't know of a single past client of mine who is anywhere near a short-sale position or having any trouble making their mortgage payment... Why?
- they got fixed rate mortgages when rates were the lowest they had been in their lifetimes,
- they bought homes they could afford, and
- they weren't buying a home while barely making ends meet (or not making ends meet).
I understand there is a big problem, but if the banks are going to be "bailed out", certainly consumers should also benefit and get some "bail out" support.
And what about those who continue to make payments on their homes and will continue to make those payments...? Shouldn't those citizens be rewarded for their common sense and for making the situation better than it would have been if we had all decided to max out and gamble our futures (because the banks allowed, and yes, even promoted it)?
Why give the bail-out money to the people who have proved they can't properly handle money?
The fair and equitable (and free-market) answer is to let the banks go through exactly what their borrowers are going through... let these companies, based on what value is really left in them, be "short-sold" to people (other corporations) who know how to properly handle money.
And NO, that would NOT be the Government!
Buying a home in Salt Lake City or the Surrounding Area? Make sure you get an Agent on YOUR side of the transaction!
If you have excellent credit and will be buying a $250,000-$750,000 home in the next 30-60 days and would like an agent who will work exclusively for you, call us at (801) 969-8989 or contact us via the link on this page.
©2008 Homebuyer Representation, Inc. "The Real Estate Agents on the Buyer's Side" TM Exclusive Buyers Agents (EBA) - All Rights Reserved
Exclusive Buyer Brokerages do not list homes and never represent Sellers. Their agents represent Buyers ONLY on the Buyer's side of the transaction. They work to get BUYERS the Best Price and Terms when they Buy...
©2008 Homebuyer Representation, Inc. - Salt Lake City, UT
Exclusive Buyers Agents (EBA) - All Rights Reserved