How Did This Happen??
The current mortgage crisis did not begin when the subprime lenders began to announce that they were facing financial difficulties due to a surge in defaults. It didn’t begin when Greenspan was discussing the housing market ‘conundrum’. It wasn’t caused by the real estate ‘bubble’ popping. It wasn’t terrorists, the war in Iraq, inflation or increased cost of barrel oil. While none of these things caused the current credit crisis, they certainly may have contributed to it. In addition, so did mortgage lenders, underwriters, appraisers, real estate agents, title companies AND consumers.
The responsibility for the current credit crisis can not be unilaterally assigned to one or all of the groups referenced above, moreover, it is an effort in futility. The road to recovery from this crisis and addressing the pervasive effect it is having on multiple levels within the economy must be focused on finding appropriate, lasting solutions. Not quick-fix, self-serving band-aids and/or rhetoric from lenders, brokers, appraisers, realtors, title agents and government agencies. We don’t need anyone else to tell us what’s wrong and who’s responsible–we need solutions. We need education and information; not legislation.
Consumer protection laws, disclosure documents, etc. have been around for years, yet it wasn’t sufficient to shield us from this crisis. We need to lift the veil of complexity and mystery rampant in the mortgage process. We need better education, information and training at all levels to both recover from the current crisis and produce lasting solutions for the future.