BBB- A few thoughts on borrowing, banks and bureaucrats

By
Industry Observer

When I was a kid, I learned about the responsibility that came with borrowing money.  If I asked someone to loan me a quarter, I knew that they expected to be paid back.  When I grew up and asked someone (bank) to loan me a bucketload of money to buy a house, I also knew that they expected me to pay them back.  It's a simple concept that I suspect has been almost universally learned.  I never begrudged the lender for expecting to be recompensed, and I never encountered a lender who forced me to accept their offer of a loan.  I have occasionally overextended myself on credit card balances, but never thought of blaming the credit card company for my discomfort.

Are there people who are so unsophisticated that they don't know they are creating an obligation to repay when they accept a loan?  I doubt it, unless they are not capable of functioning without guardianship. 

Banks are a popular target for politicians and others (more than a few real estate professionals) as a source of blame for everything economic that is perceived as bad.  They are becoming cash cows for various government legal extraction artists.  To many folks including me at times, there is a certain feel-good factor that kicks in whenever we hear that a particular bank has agreed to pay a big fine for something they are accused of doing.  Of course, the fine is ultimately paid by stockholders (frequently your and my pension and 401k funds) and benefits to the government, not the actual alleged victims.  Perhaps the bureaucrats agree that the alleged victims really knew better and should receive nothing. 

Although I feel that bureaucratic attempts to bleed cash out of banks is improper, I do not hold either banks or the g-weasels in high esteem.  Banks are inefficient, and they seem to think that customer service is a curse best shipped to an Indian phone room.  They often charge ridiculously high fees for things that should be free.  They are notorious for failing to adequately train their employees.  They are their own good reason for everyone to find a good credit union. 

 

Posted by

 Mike Carlier  Lakeville, MN

 

612-916-3033

 

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Topic:
Lending / Financial
Location:
Minnesota Dakota County Lakeville
Groups:
Realtors®
"Whacked"!!!
EXPRESS WITH WORDS AT ACTIVERAIN
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government
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Ambassador
3,155,468
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

You and I have very similar views on banks and their ultimate culpability in the mortgage meltdown.  Personal responsibility is easily lost in the ease to hate financial instituations.

Nov 02, 2013 03:14 AM #1
Rainmaker
522,322
Mike Carlier
Lakeville, MN
More opinions than you want to hear about.

The bureaucrats' relations with banks are characteristically strange.  Convince them to acquire failing WAMU, Countrywide, and Wachovia and their mostly troubled assets.  Then demand punitive damages from the banks for having a portfolio of bad loans.  Reminds me a little of a lunch experience a number of years ago.  The diner called itself a steak house and just about everyone stood in line to order the same thing, a hunk of chemically tenderized cow meat with baked potato and a slice of something called "Texas" toast.  When it was my turn to order, the cook/server/janitor said, "We're out of baked potatoes.  Is it OK if I give you french fries?"  I agreed, to which he responded, "Fifty cents extra for the french fries!"   So, BOA, will you please pick up the pieces of Countrywide?  Thank you, you are now a crook!

Nov 02, 2013 04:35 AM #2
Rainmaker
3,985,513
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

We have already started changing over to credit unions.  They don't always cater to the business's

Nov 02, 2013 09:34 AM #3
Rainmaker
522,322
Mike Carlier
Lakeville, MN
More opinions than you want to hear about.

Many of the people working in credit unions have come from banks.  I see it in the credit union I have used for over forty years (Wings).  Once in influential positions, the ex-bank folks spread the bank drivel like wild fire.  They like to fix stuff that isn't broken.  Credit unions will eventually evolve to become banks without accountability, but they are the best game in town for now.

Nov 02, 2013 11:07 PM #4
Rainmaker
2,191,220
Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

I believe the problem goes deeper than accepting personal responsibility. For years, if people bought a home and lived in it, paid their mortgage on time, they could pretty much count in 7 years of having enough equity to be able to sell and move away. People like that didn't deserve to have to do a short sale in order to move, just because prices collapsed.

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Nov 13, 2013 10:20 AM #5
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Rainmaker
522,322

Mike Carlier

More opinions than you want to hear about.
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