Is It the Bank’s Fault?

Whether you knew it or not, our house is up for sale.  (No, it’s not the one in the picture.)  Why?  Well, as you’ve read here before we’ve had some theft in the neighborhood, and the trends seem to indicate it is only going to get worse.

That, coupled with the needs of a young family to have a larger space and more room to grow mean that we’ve been on the look-out for a house for some time, but decided to try to sell ours first.  That means that I’ve been a little more attune to what’s going on in the mortgage world.

You see, there are so many different kinds of mortgages out there.  The more I tried to figure out exactly what kind of mortgage I wanted the more headaches I have gotten.  That’s because there are so many mortgage products out there.  And that’s part of the problem the whole market is in.

You see, people tend to be irresponsible with money– whether it’s small loans or large ones– we see what we can pay now and figure that we’ll always be able to pay it.  Or, we get into a situation where we accept a short-term low payment (think interest only loans) believing that we’ll be able to sell before the rate goes up or that we’ll be able to afford it then when it turns out that we aren’t.

I can’t blame the banks totally– I mean, there are multiple ways to do remortgages.  And it’s not like they hide how they are trying to make money.  If anything, the banks are at fault because they offer things that we truly cannot have– or at least should not.  I mean, you could liken it to giving someone a popsicle with a knife blade in the center and warning them about the knife.  There’s only so much you can do if they choose to lick it anyway.

The responsibility lies with the person that took out the loan.  You have to make the payments, and there is also mortgage insurance that you can pay to the bank in order to help you in case things get tight.  It may be a dangerous thing that the banks are offering, and maybe there should be more counseling, but this is America, and we should be responsible for what we get into.  There’s no reason that we should not get educated about the risks before jumping in.