Mortgage Crisis...Republican's or Democrat's fault?

Another local mortgage office closed its doors today. The story reads -   

National City Mortgage closed its office on Churn Creek Road on Wednesday, branch Manager Lynda Eaton said. National City, which has five employees in Redding, had done business at that location for nine years.

The story continues but what's interesting is the public's response to this article. Naturally, people are always looking to see who to blame.  I got a kick out of some of these comments - how did it turn into a Republican vs. Democrat issue? Ha.

The Democrat said: "Well everyone should have known that Republican leaders always throw us into recession. The same thing happened here in the late 80's and early 90's. that one lasted for almost 10 years."

The Republican replied: "How can you blame the Republicans for the housing market? We are on a natural down cycle which will end eventually. And if we get a Democrat in office this next go around, they will be lucky enough to take credit for the upswing we will eventually experience. Bush kept the prime rate down and people naturally could not think for themselves and ended up mortgaging themselves out of their homes. Is that his fault too?"

The Independent put in his 2c: "How about blaming the builders, lenders, mortgage brokers, house flippers and speculators who helped drive up the prices to outrageous levels. "Creative financing" allowed people to buy houses they could not afford. It literally was a house of cards. For example, 0 down and paying interest only on a $700,000.00 mortgage and assuming that the value would increase before the balloon payment was due was a financial disaster waiting to happen. The sad part is the honest, hard working people who got caught up in this scheme just to own a home."

Here comes the agent: "Gosh, how could this be happening? Things are different in Redding! We have a vibrant realty market. -Eternally Optimistic Agent of the Real Estate Industry"

And my favorite: "I have been a mortgage loan officer for 5 years in lending 20 and can't help to blame the following for this situation: EVERYONE, we live in a society of individuals always wanting more, this is natural. The lenders(banks/investors) have been creating more and more programs to get people into homes or refi their homes, because the lenders want more. The sad part is, the lenders creating the programs were not watching out for their customers, just the bottom line - PROFIT. Some loans so attractive, financially speaking, to brokers/loan officers to sell why offer anything else? Any good sales person can make a loan look good to someone who just wants to buy now and pay later. The really sad thing is that we have folks in difficult to remedy mortgages, mostly due to high loan to value's and negative amortization loans. Yes, they are at fault for signing but who made that loan available to begin with? Now, what to do? There is always a chance for reform and by making mistakes we learn. Let's just hope that we do learn, I think the lenders are. Signed, Formerly with one of companies mentioned, but still making loans! :)"

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