Some Bankers Never Learn

sillycrap at 19:09 2011-07-31 said:

Your article reduces everything to a Black vs White and how only the gov't can fix the problem. 20% down payment and max 3% seller help is not solution here. Most of your average buyers cannot come up with 20% and all the closing costs; what planet are you living on in the Hamptons! Paying what you can afford - ok; but the Dodd Frank law goes way off this one point. A Loan Officer must make the same percentage on all loans! how does this help anyone. So, if the Loan Officer is going to make 1.5% on a $100,000, that same Loan Officer has to, MUST make the same 1.5% on the $400,000. This does not help your $100,000 buyer, it just screws the $400,000 buyer. Oh that's right in this Obama world, it is ok to charge and tax some Americans, and if they can find a way to redistribute that, they would. How about some responsiblty on teh part of the buyer who signed for the $300,000 loan when they could only afford the $100,000 loan. The gov't now has to defend people against themselves? I thought he gov't's job was to defend us against our enemies; you are making gov't create a BIG BROTHER state. Permalink

Aaron at 05:53 2011-08-01 said:

Sadly you are right. The problem is the regulators' failure to focus on the actual crime (fraudulent product steering), which has forced them to address the symptom (making more money on higher-priced loans), with disastrous effects. Par for the course.

As for home price, I don't entirely agree. We should be so lucky has to have home prices get to the level where a normal family can afford a home with a 20% downpayment. Of course, that implies lower home prices, which disadvantages current borrowers. But the current system favors current borrowers and disadvantages future ones. Permalink