Housing "Crisis"

[deek]

While I agree the borrower should know their own finances, I still put a lot of that onus on the lenders. I mean, they should be doing their due diligence, getting you financial history, checking your income and expenses and figuring out what you are likely going to be able to afford. They shouldn't be approving loan amounts for more than the numbers show you could really afford...

Now the borrower should know this going into a bank as well, but its the bank that is taking the risk, and therefore should be very certain what they are getting into.

[cwallace]

Wallace, you're forgetting the government practically forced banks to extend those types of loans under the guise of "fair housing" and were threatening to charge them with redlighting unless they started giving loans for bigger, more expensive homes, in better neighborhoods to lower income minorities. I'm not putting all or even most of the blame there, but they hold some of it. That's what happens when government interferes with the free market. They make a mess out of things. Will the lesson be learned? Of course not.

Not exactly...they still required that you gave consideration for being able to afford it...They abused what was out there to use...got overly creative...

Chris