Why shouldn't every American who defaulted on his loan be held responsible?

Question

Sure, we can blame the banks, but didn't every single defaultee sign a document promising to repay a loan then default that on that loan?
A promise to repay that was broken and has directly led to their own hone foreclosure as well as the taxpayer bailout?
I may be going old school, I'd like to see every see everyone of the debtors publicly held in braces. Rotten vegetables are optional.

Answer 1

Why don't people in wheelchairs just get up and walk.

The point is...some people are just not able to do things agreement signed or not....want me to explain anything else?? Oh ,and it looks as if you made a mistake in spelling home even though spell check was there to help you.You should read things more carefully before signing off on them.glad you were able to fix that.

When did I ever claim logic? It's late,I can't sleep and you're fun to mess with. Gee,I should go into politics!

Answer 2

First off mortgage brokers did not have to falsify loan docs inorder to get loans approved. There are what is called B and C loans, meaning the client does not have a (or good) credit. it is the same principal as when someone has bad credit and gets a car loan, with a high interest rate.

Most of these loans are what is called an ARM loan, meaning adjustable rate mortgage. The problem with the mortgage industry at this point is that everyone that could not truely afford to buy a house was able to buy a house because of the banks willing to negotiate B & C loans, as well as NO DOC loans. those are loans that do not require any type of documentation to get.

Another problem is that many of these lenders were not clear enough, or shoudl we rather say did not speak to people like they were five years old, and so people dod not listen to the fine print that said IF YOUR INTEREST RATE GOES UP YOUR PAYMENT GOES UP. Well those are the dumbasses that have caused our econmy to be going in the crapper!!!!



NO i think that each of these people are suppose to lose their house, and have to have them put up at auction on the courthouse steps. JUST LIKE ANYONE ELSE WHO HAPPENED to lose their house (even if not on an ARM loan) if you cant afford it you shouldn't be able to keep it plain and simple....ITS LIKE STEALING, even if only on a short term basis



Why should a bank be legally obligated to not give someone a home. the person should have enough freaking sense to sit down and add up how much they make in one month, then add up the bills with the new mortgate. if the bills are bigger than the income DONT BUY THE HOUSE. if you cant figure that simple stuff out then you are to stupid to own a house, or a job, or a car or anything else that needs some serious thought.

drown the ones with no sense in the creek



if someone were to buy a home that was within their budget, and be told they had an ARMS loan, then yes it is their fault. everyone knows about inflation. and just like clock work every year gas prices go up. it has ever since i can remember. and when gas prices go up, so does groceries and anything and everything that has to b e delivered, right down to auto parts.



so if you got a loan you could afford but the price of gas and groceries going up made you lose your home, then you probably really couldnt afford it anyway.

Answer 3

Yes, Politicians are reluctant to place any responsibility on the people who bought houses with nothing or little down, bad credit or otherwise financial situation. It's just not good politics. Democrat or Republician.



These were loans that should never have geen made. There are exceptions but not the majority.



It's just better politics to go after the banks and institutions that were complicit.



I have no sympathy for either the people who made the loans or the people now defaulting on them. NONE I also have less sympathy for the politicians and breaucrats that knew better and did nothing.



But unfortunately maintaining our financial structure in necessary. This will cost everyone. All that were involved in making the loans from the bottom to the top should go to jail.



All the politicians that knew this problem was comming (Democrats and Republicians) and purposfully did nothing should be thrown out of office. The FED and the oversight commitee's clearly knew. There was pleanty of warning. Even I knew at the time it was happening we were heading for trouble and I don't pretend to be a great financial expert !!!





MCCAIN sponsored a bill to tighten loan requirements and warned of comming crash of FANNY MAE and FREDDY MAC two uears ago.



Democrats mostly and a few Republicians )Including OBAMA opposed claiming it would hurt minorities and low income. Bush boasted that home ownership was the highest in history.



Hillary Clinton also warned that there was a potential meltdown comming but did not press the issue.



NOW WE PAY THE BILL.

Answer 4

They should. The problem is that if they are held accountable, then the housing market across the country goes in the toilet, and so does the economy.



T S...you are full of crap. I am a Realtor and I turned away 15 clients who wanted to get into ARMs that they should not be in. 14 of them found another agent and lender who would put them into homes that completely strapped them. One increase in expenses and they were screwed, AND IT WAS AN ADJUSTABLE RATE MORTGAGE. Most of them were negative amortization loans. They were DEMANDING them and KNEW what they were. Every lender I know tried to talk people out of them, but they knew. About 90% of those who used these loans knew EXACTLY what they were doing. The other 10% SHOULD HAVE READ THEIR LOAN DOCS!!!! If you did not, then it is your own damn fault. Stop blaming others and take responsibility for your own choices and actions.



James...you are absolutely incorrect. It does not matter at all at what point in history, when this many foreclosures flood the market with 5 times the normal number of homes for sale, prices tank and the markets follow because of panic.





THOSE BLAMING BANKS: Sure there were a few manipulating, but being an insider, I know a lot of agents and a lot of lenders who tried to talk people out of buying at or beyond their limits. And I know a lot of buyers who were rabid and would not have stopped until someone qualified them.

Answer 5

The 7 years you communicate over with is how long the default can look on your credit record. the rather statute of obstacles for SUING you varies by skill of state and is frequently under 7 years. despite if, in the journey that your wages are being garnished, they have already gained the lawsuit and the statute of obstacles not applies. Judgments are often valid for 10 years, and could frequently be renewed a minimum of as quickly as. Even inspite of each and everything skill to legally enforce collections have expired, there is not any shrink on how long they could ask for his or her money.

Answer 6

The people who defaulted did not cause the financial failure that led to the bailout. If the same number of defaults had happened 20 years ago, it would have destroyed the housing market, but had little effect outside of it. Because of mortgage-backed securities, credit default swaps, and the lack of regulations for both, the bad mortgages were able to reverberate throughout the system.



You have to also keep in mind that the banks should have known better and never given the loans. The vast majority of people are financially illiterate and would assume that if a bank told them they could afford it, they could. Then you have to account for all of the bank officials who lied to borrowers.

Answer 7

I agree with you on this. maybe the banks and Morgage companies offerd some pretty wild asnd bad options for loans but in the end it was the borrower choice not to take the loan, I moved to Miami on a Job transer in 2003. I was offered so many options for loans for homes that where so over priced it was not funny. The realtors and loan companies where in it together and tried strong arm tatics to get you to take the bait. I was offered more than 6 x's my annual salary when only 5 years before with the same credit rating and more to put down the offer was at 2.5 times annual salarry. It was my decision to take the loan or not. Also many of these loans that will be covered will be for people who where greedy in the housing BOOM and bought multiple properties in hopes of fliping for big profits, I have a neighbor who bought 6 homes and more than 10 condos in 4 years now he is stuck with a few homes and will forclose with this buy out he is going to makeout. If i invested in th stocks or a private business and the maket changeed could I expect the gov to cover my losses NO WAY so why do it now.

Answer 8

They should! Why isn't the government bailing out the "small business owner" or other "small" people right now? How come "some" homowners who defaulted on their mortgage loans ARE being held responsible for the payment of those loans? Why, why, why? Right? Doesn't seem like things are being given fairly, right across the board, in my opinon anyway.

Answer 9

Well...I was confused when I promised to pay my electric bill, gas bill and rent. I need someone to bail me out. I had no idea that it would cost this much to heat my house. I need some government to step in and bail me out. The funny thing is....way way back, many years ago, when I knew people that were buying homes under that balloon mortgage, I would say silly things like, that doesn't sound right. What if the interest rate goes up?? I would never get that kind of a loan. Of course I was called an idiot.

Answer 10

Well in a perfect world they should. All wrongs should be punished. Everyone who obeys the law should be rewarded.



Unfortunately "too big to fail" means that if you take the moral high road and hold everyone to that standard we all go down together. If you don't know how that works, ask the question.

Answer 11

Not one person mentioned the irresponsibility of the banks for throwing mortguages at people who couldn't pay them. The banks are legally bound to withold loans from people who are noe financially secure.

Sub-prime mean anything to you?

Its true the customers messed up.

The banks did exactly the same thing but they were trying to make money for themselves not provide a home for their families.

Answer 12

The whole reason why we have laws in the first place is because people often don't know whats good for them.



Give people the opportunity to make a mistake and there are plenty who will.

Answer 13

Because we need to protect the people and hold their hands to keep the big bad bank from taking advantage of them.

Answer 14

as the saying goes -- you can't get blood out of a stone.