Who Is To Blame?

Recently I attended a seminar held by a mortgage broker regarding the many mortgage programs available to buyers.  It was truly amazing of how many programs are really out there for buyers to trap themselves.  The broker did an excellent job of explaining different kinds of mortgage programs and why we seem to be seeing a increase of homes foreclosing.  

Although it is unfortunate that there are more homes foreclosing these days, the fact of the matter is some of these buyers should not have been able to get a mortgage in the first place. 

So who is to blame for this current situation that seems to be only getting worse?  In my opinion, it wasn’t just the mortgage lenders but a combination of the buyers, real estate agents and mortgage lenders here is why.  

Buyers need to make sure they are within their budget instead of purchasing a home for the maximum amount of money a mortgage lender is willing to lend them.  Purchasing a home for the full amount a lender is willing to lend could be the difference between possible future foreclosure and living life the way you should live it.  Only one thing I can say here, budget, budget and budget.

Real estate agents need to be a little more responsible with their buyers.  A buyer is looking to an agent for their expertise and knowledge to guide them correctly.  I have lost deals because I didn’t believe purchasing a home was the best thing for that person at that time, even though they were qualified for a mortgage.  I have to live with myself at the end of the day and instead of helping someone enter a possible future problem, I’d rather loose the commission.  The buyer will respect and trust me more knowing that I am not just looking to make a quick buck thus leading to possible future referrals.  

Motgage lenders are also to blame because they were handing out mortgages like it was free lunch.  I think at one point, all you needed to qualify for a mortgage was a pulse.  This practice in a normal market would have never happened, which is where we are headed.

Again, this is just my opinion and the LATimes.com recently had an article regarding this topic which I thought was very interesting and backed up what the mortgage broker from the seminar was also saying.  It also seems to give a hint or what is to come in the mortgage business.