The ad should read "all Americans want the American Dream of Homeownership and these are ways to work towards making that a reality for you.'  Why can't we push repairing credit, saving money, etc instead of 125% loans?  Just my rant for the day lol  Sorry yours frustrating Paul!

I wonder if there are any artifical factors (asides from fair-market forces) that have driven home prices up so far?  It costs sooo much to live around here in Weston.

Paul,

I understand completely where you are coming from. I deal in foreclosures lately (because there are so many!) and it's heartbreaking!

However, my real love is finding new homes for people who do not have a lot of money and some of these programs are very helpful.  There are some programs that actually "fit" the mortgage to the people. I am not referring to the ARMS!   In my opinion that type of mortgage should be used by investors only.

I had a call the other day from a girl who took out an "interest only" loan and cannot even afford those payments, never mind the escalating payment in two years. She has no equity because the market has slumped.  What can I tell her? She is in an untenable situation. I would like to know who talked her into that one!

The pungent and disconcerting truth. 

If placing blame or  responsibility made a difference, it would surely be spread around.  The average consumer comes equipped with a propensity to dig themselves into a hole, and many loan officers have happily handed them a shovel.  The housing and refinance boom has escalated greed, blurred judgment and cheapened the very title some of us hold.  With all the money that was flying around, who could think about people?  The majority of loan officers have been chasing dollars, and pushing products,...anything to get the deal.  They forgot that they were impacting the lives of,...people.  Sometimes the ethical thing to tell someone asking for services is NO. 

Egregious marketing and over-stimulation has conditioned consumers to often have unrealistic expectations.  If I were to use a singular criteria to distinguish the pros from the hacks, it would be the gauging and regarding of unrealistic expectations.  The hack is an order-taker, desperate and ill-equipped.  Hacks do not make suppositions of difficulties, voice concerns of risk, or suggest more sound alternatives.  Hacks just get the deal done.  The lending industry is on pace to thin another 250,000 employees.  Fortunately, most of them will be hacks.

I see promise in the change looming on the horizon for the mortgage industry.  Many of the programs and products that facilitated those who were not truly qualified to borrow are disapearing from the shelf.  The businesses that are struggling the most, are those that have been handing out shovels.  Those of us that have been conducting ourselves ethically are prepared to weather the storm, holding our umbrellas with a smile.

Jason:

I agree with you 1000%... with one qualification: Is it not the reason that PEOPLE go to professionals is because they themselves find the issues and practices hard to understand? 

If that is so, then one might have somewhere to point fingers.

It was not, however, my intention to point fingers. Just to let it out that this stuff has been happening for some time.

Paul,

I believe your writings were interpreted as intended.  It struck more as a vent than a desire to place blame.  My distain rests with a point you've made clearly,....people should be able to turn to professionals for answers to their questions and be given proper direction, and objective advice.  Our outlooks seem quite congruent, I simply felt compelled to vent along with you.

 I believe the problems rest with many of those in my line of work, hence my delight with the thinning of the herd. 

As far as the borrowers in these unfortunate scenarios, I'd personally like to see people stick to their guns a bit more.  While every other broker pre-qualifying a purchase borrower will ask, "what price home do you wish to purchase?"....I've been asking,...."How much can you afford to spend on a mortgage payment, property taxes and homeowners insurance each month-comfortably?".  Unfortunatley when people fall in love with a property that is out of their (monthly) price range, they often shirk their previously stated payment ceilings and choose to buy anyway.  In these situations, folks typically opt to utilize a vehicle that may put them in a tough spot later in time, (ie....pay option arm, interest only, etc.).

It's tough on all sides,..an I hope this belt tightening across the board yields the ability for people to own their homes for longer than they are now.

Hi Jason

I wish all loan officers and realtors asked the questions you do...

I also hope that the belt tightening helps to straighten out priorities and the willingness to over extend themselves that you speak of.

One way or the other, we shall see.

Take a look at an article in yesterdays WalL Street Journal http://tinyurl.com/2pmfgo

Some explanations are just excuses... but this article says alot about what we are talking about here. 

Thank you for the kind words, and the link.  This article speaks to the heart of our dialogue.  Everybody had a good time at the party, but didn't consider they mess they'd leave and no one wants to ante-up for cleaning duty.  The secondary market is simply a mess.  Wall Street has a long shift of broom-handling ahead of them. 

The unfortunate reality is the trying times that many homeowners will have ahead of them.  At present my firm is completing a website and marketing campaign that will provide consultation for people in adjustable and other "exotic" loans an opportunity to seek more prudent alternatives at no-obligation.  We're looking forward to helping those we can, attain some stability. 

This should present a generous flux of listing prospects for agents, as the most viable alternative for a percentage of borrowers will be to sell.  In the event folks can still own by downsizing, there should be some benefit to buyer representatives as well.

When life hands you lemons.......