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WHO'S TO BLAME - THE BANKS OR THE CONSUMERS

By
Real Estate Agent with Samson Properties VA Lic # 0225101380

 

I keep reading all of these articles that are blaming the banks and lending instuitions for the current real estate problems.  Makes me wonder if all these people that are doing this haven't been to a closing.  Everytime I go to a closing they clearly go over the loan that the client had choosen, we aren't forceing these people take these risky loans are we.  People got into the mind set that they had to have a house and would do anything to get it. 

One of the biggest problems is that people look at their house as an investment instead of a place to live.  I look at my house as a depriatating assest.  By now everybody should have read Rich Dad Poor Dad. and it goes over this theory. 

Sorry everybody I'm just venting - I was reading a blog tonight that talked about people going out and buying a new house and turning their old house over to the bank.  Which in turn floods the market with more houses and makes this market even worse.

 

Comments (9)

Eric Bouler
Gardner Realtors, Licensed in La. - New Orleans, LA
Listening to your Needs
Someone did not get educated. Math is a great subject to blend in with how to live in our society. its not taught at school or at home. If people let themselves be taken they will learn quickly. The areas with the most foreclosures had the best school systems? 
Nov 01, 2007 04:15 PM
Ma Ne
Real Estate - Allen, TX
I think the banks and also the consumers are to blame. The banks wanted the business, so they got creative with the ARM loans and it looked good to the consumer until their payment increases. Now, it's biting everyone in the ____!  
Nov 01, 2007 06:56 PM
Rich Kruse
Gryphon USA, Ltd. - Columbus, OH
the banks, the consumers themselves as well as the LO's that pushed the product and lied on the forms in order to get their commission.  Then there were the appraisers that pushed the value so the loan would close so they could get paid their $300 and make the LO who promised them more business happy.
Nov 02, 2007 12:16 AM
Amber Bourland
Ozarks' Independent Realty - West Plains, MO

Unfortunately, there is no one entity that can get blamed for this whole mess. I have seen buyers who are clearly not ready to buy do all they could to get into a home, only to lose it within a year. I have seen mortgage brokers mislead (ortry) peole to get them to sign for a loan that puts them at risk. I have seen banks who refuse to work with someone who is going throuh a ahrd time, and they take a house back when it could have been caught up in less than 2 weeks. I have seen really fraudulent appraisals, and hear agents talking about only using certain appraisers so no deals fall apart... There are so many hands in any given transaction, that blaming one group is just not feasible. Just like blaming the president for the war in Iraq....

We each need to acknowledge the important role we play in the real estate industry and do our personal best, ethically and professionally, tonot compound the problem by getting involved in something we see as risky. We may each lose some commissions over it (trust me, I have), but we will be able to have a clean conscience and not have to worry about "what if somebody investigates me?"

Nov 02, 2007 02:27 AM
Konnie Mac McCarthy
MacNificent Properties, LLC - Cobb Island, MD
Broker/Owner - VA & MD "Time To Get A Move On!"
well....it is a good mix...but I did have one client who got a home, I told her she could not afford...but she was told by her loan officer she was "approved"  I could not figure out how...but she did it anyway...and one year later...she is foreclosed on...and she called me and told me she was going after the lender...I am still scratching my head
Nov 02, 2007 03:00 PM
Nick Good
The Good Home Team with eXp Realty - McKinney, TX
www.TheGoodHomeTeam.com
Everyone has a piece of the blame.  The consumer knows how much he/she can really afford.  The LOs for pushing bad deals onto the consumers and the banks for allowing it to happen.
Nov 15, 2007 03:12 PM
Anonymous
Renter

I blame the Realtors.  Yes, the Realtors.

 I've bought and sold several houses, the bank people I spoke with on the phone and I couldn't tell one from the other as I called a long list all in one day getting the best rates, when it was time to get ready for closing I worked with low level employees turning in documentation and filling out forms.  Never really met the LOs.  The day of closing, absolutely insane.  Where's the dog at, car trouble, all personal belongings in limbo, physical exhaustion, not ideal situation for comprehension. 

Realtors arrive at closing (a hopefully regular occurance for them) well rested and eager (their getting paid).  Realtors are the only constant prescence thru the entire process, relied upon heavliy for counsel and advice.  And don't try to redefine the realtionship, realtors answer all the questions and explain all of the reports and paperwork.

 Most uninformed buyers with bad loans aren't the do-it-yourselfers who hit the FSBOs; no, they relied upon a Realtor.  The barriers to entry into the profession are too low and for all the codes of ethics, very little self policing is done.

Nov 16, 2007 06:00 AM
#7
Josette Skilling
Keller Williams Capital Properties - Bethesda, MD
Ultimately the consumer needs to be better educated about the entire process, including as Renter states there are not enough barriers to entry and financial education needs to be better on all counts.  Wish I thought that whatever legislation is being pushed through would solve the problems but it won't.
Nov 16, 2007 06:48 AM
Esko Kiuru
Bethesda, MD

Vincent,

Looks like just about everybody who was involved in a home purchase a few years ago bears some responsibility for the current mess. From the consumer all the way to the investor who bought mortgage-backed securities. I agree that a home should be a lifestyle issue, not an investment.

Nov 16, 2007 01:43 PM