Comments on: Home equity at lowest level since WWII?

By: John

John — Fri, 07 Mar 2008 23:46:03 +0000

It tells me that the Congress should take their share of the responsibility for this mess. It was the Democratic leadership, including Kennedy, who demanded that mortgage lenders give mortgages to unqualified borrowers...the rest of the responsibility goes to the borrowers themselves for taking on debt they knew they couldn't pay back. This mess has caused all of us to pay for this via lower CD rates etc. The government is not in the homes business and should stay out and let this work itself out...the results will be far better!

By: Jim from Florence, Oregon

Jim from Florence, Oregon — Fri, 07 Mar 2008 23:45:45 +0000

It says reality eventually triumphs over Peter Pan and Never-Never land. People in this country have been living beyond their means and getting paid more than they're worth for decades. Welcome to the real world!

By: Sky

Sky — Fri, 07 Mar 2008 23:45:28 +0000

It just says that people are buying houses that they can't afford on terms that they don't comprehend. I'm not sure it says anything about the economy other than most Americans doen't understand personal finance very well and that they need to hire an attorney more often.

By: Zeppo

Zeppo — Fri, 07 Mar 2008 23:41:32 +0000

One year before Greenspan was replaced he said the current housing boom cannot be sustained and that the overinflation was due to FRAUDELENT ACTIVITIES on the local level. In other words, realtors pushed the prices up and appraisors played along and banks baited their hooks with interest only loans and home equity credit lines.

Only in retirement cities like Carmel and Marcos Island will property values stay above the reach of the middle class, everywhere else it has to come down and it is coming down.

The banks will be the biggest losers, because they take the biggest hit when the owners walk away from their houses and go back to renting. There will be a boom of boarding houses (like in the 50s) because builders built unsellable 8 bedroom homes.

By: Ron Margheim, Hood River, OR

Ron Margheim, Hood River, OR — Fri, 07 Mar 2008 23:39:15 +0000

To me it says that people have emulated their government. Bush has caused the largest deficit ever, doesn't include the funding for the occupation of Iraq in his budget then borrows money to stimulate the economy! What gives? The middle class, thats what!

By: Steven Smith

Steven Smith — Fri, 07 Mar 2008 23:31:22 +0000

These lenders are idiots. They have mislead and teased people into these subprime faulty appraised loans with the hope of an increased real estate market. Now that it is all falling apart they would rather take a 30% loss in their loan balances than a small loss of interest income on the payments. Do the math. Government should force them to work with homeowners and avoid a housing deppression.

By: Mike

Mike — Fri, 07 Mar 2008 23:27:57 +0000

It says that people have been using mostly mortgage debt to keep spending more than they are making and to bring forward from the future enough demand to keep deflation from happening.

By: d evanson

d evanson — Fri, 07 Mar 2008 23:27:50 +0000

what it means is people payed to much for overpriced houses using loans with 0 down. people also borrowed against their homes to buy new cars ,boats etc, things they could not afford. it means there is alot of idiots out there. a big part of the problem falls squarely on the home owners shoulders.

By: frank the mailman

frank the mailman — Fri, 07 Mar 2008 23:27:29 +0000

Jack there had to have been some headsup somewhere that the credit crisis was looming. I suspect that way before the mortgages went sour the banking industry lobbied for change the bankruptcy laws to pin people with their debt,and then kept handing money in a way that can only be described as irresponsible. Responsiblity need not be part of their business model when government is willing to bail that industry out with taxpayers dollars and then say that it would be poor policy to use the very same taxpayers dollars to bail out the taxpayers in trouble.

By: Robert R. Hooton

Robert R. Hooton — Fri, 07 Mar 2008 23:25:58 +0000

Jack,
Home equity statistics are skewed. While it is true that a bedrock of our economy is in a more tenuous, leveraged position than yesteryear, it was only a few decades ago that ALL interest was deductable. Now it is not ergo big ticket items get put on HELOC's to deduct their interest. Beyond that ,as you mention, zero down mortgages allowed many first time buyers to own there own home, a situation that would otherwise be out of reach back in the old days. The only thing that really killed the golden goose was unregulated, preatory loan practices combining severly relaxed credit requirements with zero down balloon interest rates...................
Thanks, Rob, Hummelstown,Pa.