Wow...recent news stated that even the Clergy are troubled and concerned about the current mortgage debacle. At weekly prayer gatherings it is very common that groups pray in support for our troops, pray for the poor, pray for the sick, pray for help in marital problems and job losses. But these days, many are praying about their mortgages or the overall mortgage mess.
I can understand this as Clergy watch people in their community losing homes or in danger of losing them as re-setting mortgage rates go thru the roof. Urban areas hardest hit have Clergy speaking out on the issue.
The moral dimensions of this mortgage meltdown have not been widely discussed, but let's touch on a few items. Subprime lending is not unethical under Judeo-Christian tradition. In fact it can serve a great societal purpose by enabling those with less capital to take a position in home ownership. At the same time, Clergy show concern that perhaps lenders and buyers acted immorally with 'stated income loans' where the income stated was not accurate. Hmmm...are any "stated income" loans accurate, even if they are not subprime? Stated income loans are more like a debt qualification ratio equation built around the desired goal.
As the 2007 year comes to a close, it usually is a time for some self reflection. Think about 'stated income' loans...is it a form of fraud? Are lenders and buyers helping or hurting themselves with this type of loan product? If neighbors lose their home to foreclosure doesn't it hurt eryone's value in the neighborhood and general area? Downward spiral?
As always...your comments are welcome. Send an email if you have a moment.
Best regards, Michael Caruso
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