Monday, May 30, 2005

MSNBC ' U.S. housing boom a bust for many'

MSNBC had a major article about housing and the rising amount of foreclosures particularly in working class neighborhoods.

  • "In 2000, the Philadelphia sheriff auctioned off 300 to 400 foreclosed properties a month; now he handles more than 1,000 per month. Allegheny County, which includes Pittsburgh, had record auctions of foreclosed homes and officials speak of a "epression-era" problem. The foreclosures fall particularly hard on black and Latino families. "
  • "The rates in Florida, Texas and Colorado are more than twice the national average. Even in New York City and Boston, where real estate markets are white-hot, foreclosures are rising in working-class neighborhoods.
  • So what is causing the increased amount of foreclosures?
  • "State and federal regulators place much of the blame for the foreclosure problem at the feet of mortgage brokers and bankers, who have crafted ever-riskier ways for Americans with poor credit to buy homes. Interest-only and adjustable-rate mortgages account for 63 percent of new mortgages. "
  • Rising home prices, with people buying beyond their means. Medical problems, especially when the homeowner does not have health care insurance.
  • "Is the push to boost homeownership — successive presidential administrations have strongly promoted it — backfiring? "
The credit bubble fueling the housing bubble must be stopped. Credit is something where the lender and the borrower both need to take responsibility. People can now get a negative amoization, 0 down, sub prime credit history, no income verification, interest-only adjustable rate morgate loan. It is just ridiculous. These irresponsible sub prime lenders are predators.

1 comment:

  1. over-promoted homeownership + easy financing = soup lines