What is the fuss with the Sub-Prime Lenders!
Well, as you may have seen on the news the "sub-prime" Lenders are shaking up the industry and the stock markets. This part of the business has accounted for a lot of the housing sales over the last few years, despite what many may think. A "Sub-Prime" lender has been filling the gap to provide mortgages not just to people with bruised credit, but also to the self employed and investor segments of the market.
Some of the loans are "no doc" with limited documentation of the borrowers financials. Some have been "stated income" loans where you don't have to prove what you "say" you earn. These loans filled a gap in the normal lending markets. It helped "make" sales happen. It let people get in homes that could not otherwise. These loans were priced (read as higher interest rates) to reflect the risk of the loan. Now some of the loans are tanking and foreclosures have spiked. And the Gov't is trying to say this is the fault of the lenders---WRONG! It is a fact of market conditions, and the economy and the widening economic disparity in the U.S.. Hey folks, if you aren't aware of it, many Americans are NOT making a LIVING wage. Gen Xrs are not able to live in the "style" that most of them were raised in. Single parents are stretched to the breaking point. This is an ECONOMIC problem, not the Lenders.
Let's get the economy going GEORGE, we have been waiting for years for the engine to fire up! And it hasn't folks, come on wake up and smell the coffee, the economy without the real estate market is in the crapper! Automakers closing plants when was the last time we had that going on? Back in the days of Lee Iaccoca and Chrysler? And on top of that we have the wars to pay for...
Listen, we need to be able to get "real families" in real homes. Look around where you live, have you seen any single family starter homes being built the last four years? Probably not, mostly "McMansions" in my neck of the woods. Any pyramid or house needs a SOLID foundation, and ours is eroded. We need to start the economy from the ground up. I have heard a saying that in real estate there are "bulls, bears, and pigs" don't be a "pig" as they tend to get slaughtered.
Right here and now I propose that we as an industry get the developers, builders and lenders to start to make our foundation stronger with new homes for the real families here in America. Let's start at the begining and get the engine to fire up again, but stronger, with less pig fat to burn. Let's make our Govenrment stop the credit card companies control of the average persons money---25% interest plus late fees, overlimit fees and I just want to screw you fees from the Huns! That commercial is at least honest!