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Stop The Blame Game: Part 1

Mortgage and Lending with Mount Olympus Mortgage

September 19, 2008 04:33 AM

The current crisis has many different faces. From the homeowner looking to secure the American Dream, The Realtor assisting in the home acquisition, the Mortgage Broker working with the client, and the Lender, it seemed like a win/win situation for all.

Then the bottom dropped out. Values crashed. Credit tightened and banks became less flexible. Everyday, more and more bad news came over the airwaves. Armageddon was upon us.

Then the finger pointing starts.

It was the sub prime lenders. This reason seemed plausible. After all, the market share serviced by subprime were usually urban dwellers. Of course they are the problem! Yes lets write a blog!!!

Then The "Good Loans" Fannie and Freddie backed are also defaulting. What now?

Blame the Republicans! Blame Clinton. Blame the Illuminati

Blame Somebody!!!

No...lets stop the blame game.

This is simply an adjustment. Overheating leads to over cooling. Plain and Simple.

Here in Florida the same 4/2 I looked at in 2000 for 259K went to 759K.

That is ridiculous.

Market corrections are never easy. I liken it to eating as much as you want for 4 years, getting fat, and then having to lose all the weight you gained within 1 year. Hard work and a lot of sweating.

Welcome to the gym of Reality.

Part 2 tomorrow.

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Joe A

Cupertino, CA

Elvin - I think you're right that it's time to stop blaming. The reason this just lingers on is because everyone is blaming everyone else, and no one feels really secure about what happened. No one wants this financial crisis to occur again, but government certainly has no idea who's to blame. Regulating the mortgage industry further, will not address how the financial industry demanded more mortgage backed securities, and how lending guidelines fell to the floor to meet that demand. The problem we're facing today is not simply a market correction, but the consequences of billions of dollars of fraud.

Sep 19, 2008 05:19 AM

Roger Howell

Fairway Independent Mortgage Corporation NMLS #2289 - Boise, ID

We do business the Fair way!

I think those people who are playing the blame game do it in order to look intelligent. I find those people who can move forward, trying to find the solution are the ones to listen to.

Sep 19, 2008 01:03 PM

Elvin Lewis

Mount Olympus Mortgage - Miramar, FL

"Elvin - I think you're right that it's time to stop blaming. The reason this just lingers on is because everyone is blaming everyone else, and no one feels really secure about what happened. No one wants this financial crisis to occur again, but government certainly has no idea who's to blame. Regulating the mortgage industry further, will not address how the financial industry demanded more mortgage backed securities, and how lending guidelines fell to the floor to meet that demand. The problem we're facing today is not simply a market correction, but the consequences of billions of dollars of fraud."

Your point is well taken Joe.

Regulating will not work. It will just create more red tape. Look at regulated health care for the clue.

The fraud that we have seen is a two way street. The industry just about begged for it. Getting loans packaged for sale became the impetus for lenders. Account Executives were fired left and right for not making quota. The consumer that couldn't get the loan done in one place would go down the street and get it done there.

Additionally, home equity loans were sustaining this economy for the past 4 years. Now that the housing slowdown has occured, Home Depot is laying off. Lowes will not expand as they once planned. Retail sales are down despite price increases. School boards have cut back on services because of the reduced revenue from a lack of property tax collection. Even non profit orginazations have been laying off because contributions are down.

The more surprising aspect of the housing slowdown is gas prices. Speculators that once used Real Estate to secure profits went into oil futures. This pushed the price from a 60 dollar a barrel high to almost 150.00. (This has since adjusted downward).

Finger pointing only leaves three pointing back at the finger pointer and one in the air with no direction.

Sep 22, 2008 02:13 AM

"I think those people who are playing the blame game do it in order to look intelligent. I find those people who can move forward, trying to find the solution are the ones to listen to."

Roger that!

They have to say something!

They remind me of the ESPN guys that picked the Patriots to win the Super Bowl. They sound real good before the game is played however when it comes game time they are on the sidelines.

Sep 22, 2008 02:17 AM

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