Is the mortgage crisis over?
While perusing the enormity that is the internet, I came across an interesting article about the current mortgage crisis. The homeowners in the article seem to be almost identical to many that bought homes with cheap money and are now struggling to pay their debt. Seriously, did they expect interest rates to stay that low? Maybe they expected a negative interest rate like Japan saw a few years back.
In any case, it seams that the average home buyer’s knowledge of how to buy a home is at an all-time low. Gone are the days when a family could expect to stay in the same house for 10, 20, or 30 years building equity and maybe even paying off the mortgage completely. People tend to want to move up to a bigger home as soon as they get a raise or the rates drop. Refinancing has pushed countless homeowners way past the 30 year mortgage. As another article states, people’s mortgage intelligence has fallen dramatically and the blame may lie with the mortgage industry.
Hopefully company’s like the one mentioned in that article, Red Clay Media, can start to turn the trend around and begin a new trend at responsible lending. They seem to offer marketing intelligence and a direct marketing mailing list with a goal of turning the corner in this market.
I’m in the process of trying to sell a house, but I’d rather sell it to a family that can afford to make it a home for the next 30 years than a family that will be forced into bankruptcy because they couldn’t afford their mortgage payments after a rate increase.
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