Stop me if you’ve heard this one…
A President (let’s call him…Zimmy Barter) decides to expand home ownership to more Americans. Another President (let’s call him…Dill Plimpton) decided Barter’s idea was so good that it needed to be expanded to the point where mortgage banks would have to approve more loans to people who may not have the ability to pay or else the government would have to get involved. Then, just for the sake of argument, let’s say there was a monumental global economic collapse due in part to the Barter/Plimpton mentality. It would be utter insanity to repeat the steps that lead to the collapse, right?
Wellll…not according to the Obama Administration. Recently, President Obama proposed banks lend money to people with bad credit so they could buy houses. But don’t worry. The government will provide additional insurance to protect lenders in the case of default because we’re totally flush with money and completely recovered from the financial meltdown of 2007.
Yeah, and if you like your doctor, you can keep your doctor.
As someone with 15 years of experience in the mortgage industry, I can tell you returning to the lending standards from before the mortgage crisis is a worse idea than getting driving lessons from Caitlyn Jenner. Lending money to people with bad credit comes with an amazing amount of risk. That’s why the interest rates on “payday loans” are higher than Snoop Dogg in Colorado on 4/20. Even with government insurance, it’s too great of a risk. Let me put it this way. We have a federal government who can’t seem to live within its means backing up people who have a similar problem on a smaller level.
Yeah, doesn’t inspire a lot of confidence, does it?
While President Obama’s intentions may be noble, the reality of the situation is not everybody is capable of owning a home. It takes a lot of work, commitment, and yes, money to ensure the house you get from the bank doesn’t wind up getting lost in a foreclosure sale. If Obama gets his wish, I guarantee we will see more and more people lose their homes on the promise of a President whose current political capital makes a crack house in Detroit look good.
It’s said the definition of insanity is doing the same thing repeatedly and expecting a different result every time. For Democrats, it seems to be standard operating procedure.