Since every loan document I ever signed had a perjury clause, I like you, am eagerly awaiting fraud charges against some of the borrowers. But I'm not holding my breath.

You really missed out a better than true deal
in Houston, a builder auctioned off 10 brand
new townhomes in a gated community. Starting
at 85K upwards for each, and if any were not
sold for at least 85k and someone bid a dollar,
they got them selves a huge deal. How's that
for being financially responsible?

I don't think we will ever see any kind of prosecution for fraud, dereliction of fiscal duty etc charges come out of the Mortgage debacle. To do so would require not only holding the mortgagee responsible, but would also require examining the role of the real-estate agent, the appraiser, the mortgage brokers, underwriters, federal regulators etc. All were complicit in the pricing run-ups and easy, look-the-other-way credit.

Appraisers (both private and tax appraisers) supported the developers/sellers/realtors pricing. It was in all parties best interest to do so. Realtors convinced a lot of buyers that sure, the continous rise of housing prices would never stop. The fed kept lowering interest rates so the lenders would be able to keep offering loans on housing that was ultimately overpriced for the market. Since easy money was available lenders watered down traditional requirements opening up mortgages to people that would of never qualified in the past. Lenders and borrowers both did the wink-wink, nod-nod when signing onto loans that were risky based on the "fact" that housing would continue it's runaway appreciation and be able to be sold at a profit or re-financed in a couple of years. Property taxes up exponentially based on sales prices in many areas and began the squeeze on mortgage holders for the few extra dollars they just didn't have. Add to that a stagnating economy with little growth in real income and the bubble burst as risky loans became due.

Huge numbers of honest, ethical people, the majority of home owners actually didn't get caught up in this. It was the pie-in-the-skyers, the ones that believe what a salesman tells them, the ones that never plan past the next pay-check that got caught up in it.

I was semi-responsible, too, but I'm beginning to think that the REALLY smart thing would have been for me to buy as much house as I reasonably could have while mortgage standards were looser, then turn around and rent bedrooms out to roommates to defray the cost of the mortgage.

I was hoping to buy end of this year. Turns out I'm not going to be able to manage it. Conversely, I wouldn't be surprised if my dentist is buying a house fairly soon ...

--|PW|--