From Yahoo News:
Who says bipartisanship is dead? From President Bush to Hillary Clinton, Barack Obama and John Edwards, to Mitt Romney and John McCain, virtually everyone in Washington agrees: The government must Do Something to stop home foreclosures across the country. These leaders agree on the total presumption of homeowner innocence. The borrower-as-victim and lender-as-predator storylines are etched in stone. Can’t let reality get in the way of election-year pander-monium.
Special guests at the State of the Union address are usually extraordinary heroes, entrepreneurs or citizens who’ve gone above and beyond the call of duty. On Monday night, one of those guests was an Indiana woman whose claim to fame is that she called a 1-800 number and was assisted by the “Hope Now Alliance,” a group Bush convened, which, according to him, “is helping many struggling homeowners avoid foreclosure.”
Subprime victims are the new heroes. Welcome to the politics of foreclosure.
I certainly have sympathy for borrowers who may have been misled. But for every “predatory lender” out there, you can find a predatory borrower. For every fraud-minded loan officer or mortgage broker, you can find a homeowner who secured financing and bought a home he knew he couldn’t afford with little money down and bogus or no income verification. Washington is silent about this reckless behavior, which it is encouraging both tacitly and explicitly.
The true victims in this “crisis” are those who paid for homes within their means and those who waited to enter the housing market. A reader in New York City wrote me last week:
“My husband and I patiently sat back and watched while our friends made a killing in real estate over the past six years. … Now, after several years, we are ready to move to the ‘burbs, and we feel it is responsible people like us who are going to get hurt by this mortgage mess. We’re the ones who have to sit back and wait for housing prices to fall, while our government, looking to protect only the homeowners, keeps prices artificially high with bailout programs and artificially low interest rates.
“What about programs to help out renters who didn’t make any money in this bubble because we were responsible? What about government intervention to lower the still-high housing prices so we aren’t locked out of the market? A natural correction in the housing market is in order, but the government seems hellbent to prevent it from taking place. In the meantime, we are priced out of the market because we aren’t willing to get in over our heads financially (unlike some of these revered homeowners).”