Quote:
Originally Posted by seattleflamer
When I hear or read stories of buyers who didn't know or understand that their say, $300/mo payment would go up 4x or whatever as much, I don't have much sympathy.
There is a gov't regulation in existence since the 30s called the HUD statement which explicity and in layman terms gives your monthly payments, interest rate, potential payment scenarios and total interest paid, etc whether it is a vanilla 30 year fixed to the more exotic ARMS(adjustable rate mortgages) or option ARMs.
There is a naivite or greed involved if a. you believe or depend on your realtor, mortgage broker or appraisal firm to tell you how much you'll be paying instead of reading the HUD before signing the contract and b. you purchase a home knowing full well you can't afford the payments when your ARM resets GAMBLING that you can sell or flip before the reset.
There were certainly many situations where there was predatory lending but not enough to cause the entire crisis. So in that sense, buyers were part of the problem when they were gambling or didn't really understand what they were doing.
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Who's talking about sympathy! they didn't have a house before, they don't have one now. The buyers are essentially no better or worse off.
It just bugs me people are blaming buyers for this mess, they tried to buy a house, they were sold the idea it was the american dream by both the dems and republicans, their bank told them it would lend them the money and the real estate market told them house prices would never go down always up so they would be able to sell and make a little money if they couldn't make the payments.
There are plenty of people in Vancouver with a sight better education that are doing the same thing, this market is in an utter bubble, due for at least a 20 or 30 percent correction and yet no one in the indutry is mentioning it, when our interest rates go up 5 or 6 points it wont be any better here.