Why are people saying poor people caused the mortgage meltdown?
by Mortgage Rates on Wednesday, December 1st, 2010 | 25 Comments
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You’ve not done your homework!!!! “F” for you.
Because the middle-class aren’t able to pay off their mortgages. It’s not entirely their fault, though. It’s also the fault of the banks and lenders that loan them so much.
People that bought homes that were too expensive for their income. Lower, middle and upper class.
Fannie and Freddie were pressured to especially compromise their lending standards for lower income people though.
The answer isn’t that simple. Quite a few people had a lot to do with this economic crisis.
http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html
CRA’s aren’t even traded with sub prime mortgage bonds . . . so all you people that quote this as part of the downfall are LIARS.
Oh yeah. Definite F.
Many of the people involved in this were trying to “flip” homes. The poor had very little to do with this, but it’s so much easier to blame them.
the people saying that don’t believe in equality. No one was giving home loans when todays top families were starting out. Back then people just settle on land and built a house. I can guarantee you if it were like that today rich people wouldnt be able to build sh!t
The “people” who blame the poor are Republicans who can never accept responsibility for their actions. They always have a scapegoat handy. How ironic that they call themselves the part of personal responsibility.
there are 5 million mortgages in the hands of illegal immigrants thanks to the Fannie/Freddie group and the other mortgage lenders who did so for their own greedy reasons. The Republicans are blaming the dems because the DEMS are at the root of all this evil! Nice going Dodd, Frank and Pelosi!
The republicans are looking for a scape goat; but in fact in order to have applied for a mortgage you had to have a job at least and records show that only 1/5 of the defaults are of minority decent or in minority communities.
the sub prime loans are loans made to people who wouldnt normally qualify for a loan… why would you loan to poor people? Well Obama used to sue banks for not issuing enough of these loans. That is the only reason they would do things like this is at the prodding of the Government and activist lawyers like Obama. Then he turns around and blames deregulation. Its like playing russian roulette and when someone gets shot say oh my god who made this gun. Its not the gun its the dumb game you were playing
Republicans are not blaming the credit crisis on the poor, that is a smoke screen by Franks to through the spotlight off of him and Todd.
Because the Republican represents the interests of the very rich and the extremely rich.
I don’t think it was the poor people, but I think people have been living way above their means and buying homes that they really can’t afford. We have several friends who makes about what we do and have bought homes that I could not even dream of affording. B/C their payments were so high, they bought other things with their credit cards and now they can’t afford their mortgage or their credit card payments.
don’t take a loan that you can’t pay back. end of story.
MANY MIDDLE CLASS PEOPLE LOST THEIR JOBS.
AND REPUBLICANS ARE JUST EVIL AND WICKED TO BLAME POOR PEOPLE -AFTER ALL IT IS THE WEALTHY REPUBLICANS WHO HAVE HAD MOST OF THE POWER IN OUR COUNTRY.
Because poor people got mortgages to buy homes that poor people can’t make the mortgage payments on. ACORN and people like Obama forced the banks to do this.
It’s a lot more complicated than that, but if you mean why are some people trying to blame the CRA (which only applies to FDIC insured banks), then I will say the people who are saying that are either dishonest or have been misinformed by dishonest people with a political agenda.
I can guarantee that if it were true, then the lenders, mortgage brokers, investment banks, and reinsurers who managed this debacle and who we are now bailing out…. would be screaming it loud and clear. There is a reason they aren’t doing that: we have their books, and they need a bailout for the mess they created all on their own.
No we are blaming people and banks who borrowed and lent money when the finances weren’t able to handle the loan. The fault doesn’t fall on the poor (even though they should have made better choices) because someone gave them a loan so they took it but the fault lies in the politicians who wanted to give welfare loans to people who couldn’t afford it. Now those people are losing their homes because the govt made it to easy for them to buy so the democrats should feel a little guilty for ruining the lives of those poor people.
You would think, huh? Well, this is what actually happened:
The democrats including Obama and HIS FRIENDS AT ACORN,
used their political power to allow Acorn to threaten and intimidate
banks and other lenders to GIVE NINJA MORTGAGES OUT -
NINJA MEANS: NO INCOME NO JOB NO ASSETS.
They forced these to give out mortgages like penny candy. The people who got the mortgages cannot afford to pay them and John McCain
wrote legislation to STOP THIS TWO YEARS AGO.
THAT IS A MATTER OF RECORD IF PEOPLE WOULD ONLY
LOOK AND SEE. The majority DEMOCRATIC congress threw the
legislation out, and yelled and screamed at McCain in 2004 that he
was only trying to upset the democrats when nothing was wrong
with Fannie and Freddie, who were insuring these bad mortgages.
When Fannie and Freddie went bankrupt, OBAMA HIRED THE TWO BIGGEST CROOKS FROM EACH OF THOSE INSTITUTIONS ONTO
HIS CAMPAIGN; FRANKLIN RAINES AND JIM JOHNSON.
Franklin Raines walked away from Fannie with 90 milliion dollars of
OUR MONEY; if Obama was so much on the side of the people as he says he is, WHY DID HE HIRE ONE OF THE TOP CROOKS IN THIS WHOLE MESS?????
MY GOD, to put Obama in the White HOuse mean to put crooks,
domestic terrorists, muslim nutjobs, Anti-semites, felons AND ACORN RIGHT INTO THAT PRESIDENTIAL POWER WITH OBAMA.
any person who votes for Obama is either not learned or else hates
America, there is no grey area here. He will destroy this Nation.
Banks contributed to our current problems, and so did people from all income classes, including the poor. Over the past few years, it became easier to get credit. I remember seeing loans where you could finance up to 103% of the cost of a house, so you didn’t need any down payment and didn’t have to pay closing costs. On top of that, several of these were “No Doc” loans where no proof of income was required.
I’ve seen the effect these standards have had on my neighborhood and surrounding areas. Many of the people getting these loans were poor, and they didn’t do their homework before signing on the dotted line. You can blame the banks and you can blame the lack of regulations, but you also must blame the people who failed to say no to easy credit.
Politics is only part of the reason they want to blame programs to help poor people own homes. More important is that this was the primary way government interfered in the free market, and if it was not the fault of these programs then must be because of market failure. True believers in Reaganomics can not accept what has happened so they need to blame the government, not market forces.
1 in 6 houses in the US has a mortgage greater than the current market value because of the increase in home prices starting in 2002 and then the decrease starting in Jan of 2006. These homes can not be sold to pay off the mortgage. so it is expected that 20% or more of them have or will result in foreclosure. It is not the credit rating or income of the borrower that is causing the problem, but the fact that many mortgages were given with little or no down payment and how much housing prices declined in their city.
However this alone was not enough to cause a financial crisis. There were bazaar financial manipulation betting on the value of these mortgages to investors resulting in losses to financial institutions many times the loses due to the mortgages.making many banks insolvent all around the world.
Wow, i hadn’t heard that Republicans are blaming the “poor.” parenthetically, i’ll take the “poor” to be those with little liquid assets and low credit scores.
the crisis arose after phil gramm (R-TX) pushed to repeal the Glass-Steagall act from 1933 (2). By the way, this repeal occurred during Clinton’s presidency and Gramm’s backing came from some of both parties, dem’s and repub’s. the repeal of this act allowed predatory lending to those with high risk credit for a delayed and absurdly high repayment. So banks put many people/families in homes, their dream of a lifetime, and profits to the banks poured in while the new homeowners could afford their mortgage payments. while these initial payments came in the management in these banks/lending institutions got away with highway robbery taking hundreds of billions in salaries and bonuses.
any blame thrown around in DC is only to confuse the masses while more bad things go on. try reading Howard Zinn if this interests you (1).
google for “usury.” it will be obvious this crime on humanity is an old trick. it was what many tried to escape in creating the U.S.
it is okay to be optimistic as the ‘hemline seems to follow the economy.’ after several years of recession, we’ll have morals again. As long as america stays america and isn’t swallowed up by the lower class of mexico who bring their history – overpopulation until their host animal dies then epidemics.
The poor people didn’t cause this problem. It was the lending institutes that were underhanded in how they presented the financing package to the borrower. And now we see what has happened to these institutions. Because of their greed, most of them have gone belly up. So no one wins this battle.