Quote:
Originally Posted by sperbonzo
Just like the last bubble, it is the government pushing banks to "loosen lending standards" all over again. Go ahead, thank Obama. 
http://articles.washingtonpost.com/2...sing-officials
"The Obama administration is engaged in a broad push to make more home loans available to people with weaker credit, an effort that officials say will help power the economic recovery but that skeptics say could open the door to the risky lending that caused the housing crash in the first place.
President Obama’s economic advisers and outside experts say the nation’s much-celebrated housing rebound is leaving too many people behind, including young people looking to buy their first homes and individuals with credit records weakened by the recession.
In response, administration officials say they are working to get banks to lend to a wider range of borrowers by taking advantage of taxpayer-backed programs — including those offered by the Federal Housing Administration — that insure home loans against default.
Housing officials are urging the Justice Department to provide assurances to banks, which have become increasingly cautious, that they will not face legal or financial recriminations if they make loans to riskier borrowers who meet government standards but later default.
Officials are also encouraging lenders to use more subjective judgment in determining whether to offer a loan and are seeking to make it easier for people who owe more than their properties are worth to refinance at today’s low interest rates, among other steps.
Obama pledged in his State of the Union address to do more to make sure more Americans can enjoy the benefits of the housing recovery, but critics say encouraging banks to lend as broadly as the administration hopes will sow the seeds of another housing disaster and endanger taxpayer dollars."
IT'S NOT THE BANKS BUD, IT'S THE GOVERNMENT. it's the government messing with what would be proper risk management in a non-subsidized open market, and instead forcing things and then covering the risk.
. |
It's not about weak credit and loans.. You can have a solid credit history and fall on hard time for 6 months and your credit gets trashed. It's happened to me. At that point even if you pay off your past debits your credit is still fucked for the next 7 years..
That doesn't mean the people will just toss away a home mortgage and are incompetent. Lots of families whom were otherwise good credit risks got caught up in the housing crash and lost their homes. Their credit is now trashed for the next 7 years.
If the banks are getting a free pass for their part, why should the average Joe's be the ones whom get penalized? Who the hell else do you think is going to re-buy all those homes that are vacant all over the country? Do you expect them to sit there empty the next 7 or 8 years because people can't get loans and no one can buy them?
Use your brain for half a minute.. Rebuilding the economy means people have to be able to get loans and considering what just happen there are a lot of people that will have credit problems. It's inevitable.
Besides that.. This isn't about people with bad credit. This is about lenders still trying to push more expensive loans than they should be by once again playing the numbers..