Texas Rainmaker

I think I’m supposed to feel bad by the content of this article distributed by AFP.

US mortgage crisis creates ghost town

The streets are empty. Trash rustles down the road past rusted barbecues, abandoned furniture, sagging homes and gardens turned to weed.

This is Shaker Heights, a suburb of Cleveland and a town ravaged by the subprime mortgage crisis roiling the United States.

But somehow, after reading the article, I just don’t have that deep down, gut-wrenching feeling I think the author wanted me to have.

While the article starts off with examples of a town whose occupants have all but moved away or those who remain, but are on the verge of losing their homes, there are some details within that make this article and the entire mortgage “crisis” an issue with which I have little sympathy.

Am I heartless? Hardly. Unless I’m supposed to feel bad for companies who failed to conduct proper due diligence on those to whom they’re lending huge sums of money… or borrowers who over-extended themselves, didn’t take time to learn the terms of their loan or simply lied on their applications. In article after article, these seem to be the facts behind this supposed “crisis”. Even this article has examples of:

Borrowers not taking the time to understand their obligations…

After three rings of the bell, Sarah Evans, 60, opens the door with a mixture of curiosity and alarm.

She says she is one of the last people left on the street. And she is on the verge of losing this two-bedroom house in which she has lived for more than 30 years because she simply cannot afford her monthly payments.

It is a complicated story. She refinanced in 2003, but did not realize the document she signed included provisions to radically increase the interest rate.

She stopped making payments in 2006 and shows her unpaid bills totaling 24,000 dollars.

Banks too careless to bother checking on whether borrowers could repay their loans

For county treasurer Jim Rokakis, the greed of the banks is to blame for this man-made disaster.

“All you needed was a pulse to buy a house. Some loans were written with no money down, no proof of buyer’s incomes.

Borrowers not being truthful on their applications…

They did not even check what people were saying. Most of those folks were jobless,” he said in an interview.

Yeah, sorry. This sympathy train has departed the station.

“Shaker Heights was the perfect storm: poor folks, unemployed and a desire to get a piece of the American Dream.”

Apparently, the American Dream is now defined as borrowing more than you can afford to repay from lenders too greedy to check on your ability to repay… and then asking the federal government to bail out both sides using money from financially responsible taxpayers.

The era of irresponsibilty has now been fully ushered in.

And for good measure, let’s make sure we paint this story as one of racial inequality as well.

US blacks see ‘financial apartheid’ in subprime crisis

They had small means and big hopes of owning a house. But African-Americans snared in the US mortgage crisis have seen the American dream turn into a nightmare many call “financial apartheid.”

The storm triggered by risky “subprime” loans has left many in ruins, forced out of their modest homes and furious at falling victim to financial dealings that have taken a particular toll on minority families.

Of course, it’s not racist to suggest the evil lending companies targeted poor, uneducated blacks, but imagine the outrage if someone suggested those same “victims” were instead simply trying to live beyond their means and found greedy lenders willing to take irresponsible financial risks to lend to them…

And if the idiocy of this whole storyline hadn’t reached it climax yet… consider this close to the top:

For Cleveland Plain Dealer columnist Phillip Morris, the extent of the devastation is comparable to that wrought by Hurricane Katrina, which devastated New Orleans in 2005.

In the hardest-hit suburb of Cleveland, “nearly 24,000 people have lost their homes to Cleveland’s Katrina,” he told AFP.

Putting aside the obvious racial implications of this ridiculous comparison, let’s just take a look at the comparison. The only way this makes any sense is if homeowners could negotiate with a hurricane the terms of the hurricane’s strength and come to an agreement with the hurricane on the financial cost of landfall prior to purchase.

Otherwise it’s just a gratuitous attempt at leveraging the alleged racism arguments from the Hurricane Katrina event to support equally asinine racism arguments in this mortgage story.

UDPATE:
And right on cue, here comes the immigrant angle:

WASHINGTON (Reuters) - As an economic slowdown and the subprime mortgage crisis deepen across the United States, Hispanic immigrants are increasingly in danger of losing their jobs and their homes.

Both legal and illegal immigrants joined Americans in buying homes they could barely afford when the market spiraled upward and many have been caught with mortgages higher than the value of their homes as prices have slumped in the past year.

So now I am supposed to feel sorry for folks who broke the law in coming here only to overextend themselves financially? I wonder if these ‘journalists’ write this crap with a straight face.

So whose fault is it this time?

Like many caught up in the crisis, the father of three said he had no idea his monthly payments would soar two years into the mortgage when he closed the adjustable-rate subprime deal.

“You have to sign a lot of things when you buy a house, so I didn’t read, I just signed. I think it was the anxiety, the happiness of buying my house,” he said. “I feel a bit betrayed.”

I rest my case. The high price of education.

UPDATE 2:
Here’s a concept: “That’s why I developed this unique new program for managing your debt. It’s called, “Don’t Buy Stuff You Cannot Afford”.

UPDATE 3:
Glenn hits the nail on the head: “Shouldn’t there be a price for being an idiot?”

Posted by TexasRainmaker |
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