“Am I the only one who wonders how a person who borrows money he can’t repay, buys a house he can’t afford, and then stiffs his creditors, is allowed to play the victim?”
Michael Lewis on who’s to blame for the default crisis.
6 thoughts on “Best line of the day, so far”
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wonder when was the last time the author had to deal with willfully negligent landlords, been pursued by predatory real estate agents, and had the american homeownership dream waved under his nose.
Oneken, I agree with you in part, but frankly I am tired of people who refuse to take responsibility for themselves and instead want to play the victim. There are too many real victims in this world.
Because I am in this industry I feel that I can speak to this with some level of authority. I have been in the “Sub-Prime” market for almost 10 years along with the “Prime” Market. I have become increasingly jaded by the borrower in general. In almost every instance, I hear a sob story and believe me that they are never, ever, ever at fault. It is always “someone done me wrong” no matter what level of education they are. I mean to say, “Sub-Prime” is every level of income, education, race whatever. I’ve met doctors and gardeners with the same damn story. Now, it’s true that the subprime market has come up with some creative financing in the last couple of years that is probably the root of all our current mortgage troubles. What the articles are referring to in the media are generally the Option Arms or sometimes they are called “Pick-a-Pay” loans. These loans are a bad idea unless you are a property investor and you flip your investments on a regular basis. Also, there is a lot of attention on “Stated Income” loans. Borrowers are all THRILLED to tell you whatever you want to hear in order to get into a house and I understand the thrill of homeownership. I am always happy to get a borrower into a home for the first time. This industry is heavily regulated as far as disclosure is concerned. But the minute things turn south for a borrower the first words out of their mouth are to bad mouth the industry. The point of my tirade is essentially this, Ken is right. There are too many real victims out there. These borrowers that I read in the paper were only too happy when they got their house. I counsel people constantly that they are buying too much house, they won’t be able to handle the payments even though on paper it appears that they can. This kind of borrower in general will not be told no. It is their “American Right” to have a house. And they want the expensive one because that’s their right. And when the repercussions hit….believe me it’s never their fault. These people are subprime now and they will always be subprime. 99 out of 100 times it’s due to poor money management. These customers would rather buy a boat then pay a single credit card payment on time. And every one of their cards are maxed out anyway. But when they can’t make the house payment the best plan is to play the victim and blame the “unscrupulous loan officer”. I’m weary of the whole thing. The industry will right it self because if it doesn’t this country will be in HUGE trouble. But until then…….deep sigh.
no one is about to make a case for the american consumer whose wiggling knows no end. every day patrons come into my library with a litany of excuses to get out of paying a dollar fine, and will recite any long list of reasons why it is simply not possible that they have lost such and such a title because neither they nor their children ever checked out said book.
but this whole house of cards, this strange american economy, is built upon a necessarily self-perpetuating avarice; its dilation keeps the economy afloat. it’s what advertizing is about. it’s what loan officers and realtors are about. and car salemen and brokers and bankers. they are not the idiot consumer’s friend. they are there to help him wander into trouble.
‘caveat emptor’…..’a sucker born every minute’ –are these the slogans of a beneficent system? when granny is flim-flammed out of her life savings by a smooth-talking con artist –when the fly steps into the spider’s parlor– will there be those who chide her for being foolish enough to believe the impossible?
Because I am a conscientious and moral Loan Officer, I will have to take some offense to your final paragraph. Just as you are probably not a gray-haired nasty old biddy of a librarian as some of your stereotypes might suggest. I will agree that there is avarice in my industry, probably more in the subprime market than in other areas, but there are good things about the subprime industry as well. It wasn’t that many years ago that only customers with perfect credit need bother to apply. Anyone that was self employed had a very slim chance of qualifying and anyone with a wrinkle in their credit had no chance at all. I am proud to say I have obtained many loans for worthy people that I felt confident would uphold the mortgage agreement. And all at a very fair price that allows my family to eat and me to sleep well at night. The fact that there are loan officers that will put a little old lady in jeapardy is abhorrent, but let’s not pretend that con men are new to this world and only rose out of the slime of mortgage lending. If this industry crumbles – and believe me you had better pray that it resolves itself – the con men will find a new way to swindle the little old lady. They always have. But at some point, the borrowers who get themselves in over their heads need to be made accountable for their own actions. Not necessarily the old ladies per se but if I might suggest that if a deal looks to good to be true………
In my opinion, this phenomenon is a manifestation of the dominant paradigm in this country/economy. Isn’t our government doing the exact same thing on a grander scale? Borrow and spend, borrow and spend, and damn the consequences. Let our kids and grandkids pay for it!
It isn’t just folks who are buying houses who are going bankrupt. Governments at every level in this country are sinking, from the top on down. It’s every bit as irresponsible, even immoral, for our nation to go bankrupt funding a war in Iraq while our infrastructure crumbles, as it is for someone to buy a house they can’t afford, and then default on it.
My personal philosophy is not to spend what I don’t have. Yes, perhaps, buy a car and a house on time, but only affordable ones–affordable even if my income drops somewhat. Don’t use credit cards except where necessary, such as to rent a car or purchase a plane ticket online, and only if you pay them off right away. If you don’t have the cash in your checking account to buy it, don’t buy it! Prioritize your spending–food, shelter, and essentials come first. If there’s anything left over, then, and only then, do you buy frivolous things or luxuries. Use common sense. I have lived on far less than most Americans for most of my life, so I know it can be done. It requires an attitude adjustment as to what you really “must” have to be happy. (As if happiness ever came from materials goods or possessions.)
But again, where is the model for this behavior, if no one ever taught you? It’s certainly can’t be learned by observing our current government.