Am in New England on some business and some personal downtime this week, and heard the most horrid "subprime mortgage" story. A friend in southern Maine tells me that an acquaintance of his, with mediocre credit, was denied an $80,000 mortgage for a home on 2 acres in the woods "because a single woman with two kids shouldn't be living alone in the woods." Now, that is not grounds to deny a mortgage. But what makes it worse is that she supposedly was approved for a $130,000 mortgage for a house in town that she was concerned was more than she could support.
Guess what? Now she's in a bind financially and may lose the house. And the mortgage broker who found her the great deal and had a colleague find her the bigger home in town she really didn't want, has his fee and will feel none of the problems she is experiencing.
I deal a lot with incredibly honest, caring and smart mortgage people in the commercial/investment world. From big projects to small ones. It irks me to no end what has happened to people and their homes today. Some of it is "keeping up with the Jones" and overextending on credit, or taking that "interest-only" loan now because they figure they'll be doing even better financially in three years. But more and more it is being shown that a few uncrupulous mortgage brokers put people into homes the broker knew they would never be able to keep. At outrageous fees, at outrageous terms. And our economy is paying the price . . .
Okay, time to take a walk. Headed up a logging road for a long hike today. Maybe that will help me cool off!