Upside Down Mortgage

Subprime Predatory Lending

Question: Who is to blame for the subprime mortgage mess?

Is it the lenders? Or did the Bush administration policies create an atmosphere favorable for risky lending and predatory loan practices? Or is it something else? Links, of course, are appreciated.

Answer: It is the borrowers. They bought houses that they couldn't afford, and when they went up in value, they took that money out so that they NEVER had any equity in the place. When the value of their house decreased and they couldn't take any free money out, they decided to walk away.

"Buying" a house for $0 down is called RENTING. So if someone put $0 down, took $50K OUT of the house then the price went up, and now they lose their house because the payments went up too high, how are they worse off?

Rep. Gillmor Statement on Subprime and Predatory Lending

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