Many critics of President Barack Obama’s administration, mostly from the opposition, and some groups not necessarily critical of Obama, have blamed ordinary working Americans for the rapid rise in foreclosed homes across the country. They say that these homebuyers were irresponsible for not keeping up with their monthly payments.
Some of these homebuyers are also called stupid or reckless for taking up mortgage loans that in the first place they could not afford to pay. The critics say these troubled borrowers are to blame for the glut in foreclosure homes and they should not be bailed out with responsible taxpayers’ money.
Fortunately, these ordinary homeowners have voices in government, such as Massachusetts congressman Barney Frank and Federal Deposit Insurance Corporation Chairman Sheila Bair. Both Bair and Frank, also chairman of the House Financial Services Committee, have been campaigning for the rescue of troubled homeowners to avert the rising number of home foreclosures. But they were rebuffed because critics say owners of foreclosure homes are too blame for their foolishness.
But at last, as the foreclosure problem is being debated in the media and in various circles, the reality that financial hotshots and Wall Street financial companies had big contributions to the mess is surfacing.
These financial hotshots offered mortgage loans to as many borrowers as they can fool without checking if the borrowers can really pay the loan. They were only interested in making commissions. They even offered adjustable-rate mortgage loans to attract borrowers knowing very well that the borrowers will not be able to keep up with the monthly payments after the first years.
To make more money from these loans, Wall Street firms packaged them into complex financial instruments and sold them to foreign investors. When the boom years passed, reality set in and the borrowers could no longer pay their loans. More and more defaulted, starting the flood of foreclosure homes.
When President Obama released the details of his $75 billion foreclosure program, the critics surfaced again, claiming that the program is taking away money from responsible borrowers and taxpayers to give to irresponsible owners of foreclosure homes. If the critics study the details of Obama’s program, they will see that there are controls to the program to prevent abuse. They will see that the most irresponsible homebuyers they are referring to are excluded from the program.
Print This Post
Email This Post
HUD Fair Housing Equal Opportunity
