The state we're in

Latest News that foreclosures are up 600% may be a little decieving. Foreclosures are up, that is certain. How many actually go all the way to sale, that's another subject.

Without question, the greed that permeated the real estate market is now taking it's toll. Just like with day traders before the stock market crash, everyone that got into the craze during the run up of property values and now find themselves with escalating ARM mortgage payments and now equity are scrambling. The greed also was bolstered by the mortgage, real estate and investments industries that did little to educate consumers that nothing lasts forever. Not to say that consumers are not responsible for their financial ills. We are all consumers, and, as such, should be held accountable for our decisions.

Most people that are in trouble right now are hard working individuals or couples that wanted a piece of the American dream, others to move up to a more functional home. Many of these people may have stretched themselves to buy the home, especially combined with the allure of little or no down and historically low interest rates, especially the often misleading pay option ARMS that less than scrupulous loan officers were hawking due to the high commissions paid on them by the banks. In reality, this started a long time ago. We are just in the midst of a financial 'perfect storm' that is causing many up and down the economic scale to scramble. In regards to real estate, it's not just the 1st Time homebuyer; track and custom builders, 2nd and investment property owners as well as McMansion dwellers all have a place on the foreclosure/bancruptcy list. Combine that with a the administration's push early on for an 'Ownership Nation', where banks were pressured to provide high risk financing to put more people into homes and you have a recipe for unsustainable growth and potential (and now real) financial chaos. I agree, we are all adults and must take responsibility (read everything you are asked to sign, perform due diligence, etc). At some point, emotion takes over. I have worked with people and have been involved with real estate and finance for over 20 years. Without exception, during every interest rate dip that sparked a refinance boom, people, as a whole, spent more time picking a breakfast cereal than they did a mortgage product. "What is rate and fees?" was the question of the time. Don't be concerned about what this 'killer rate' is going to look like in a couple of years. I am in the mortgage industry. We are part of the problem. The problem is correcting itself, as it would in any free market economy. This is a cleansing process and will undoubtedly make renters out of many people that were not in a position to own in the first place. I don't mean to be harsh. Just hard fact. Sensibility will return. Next time we enter into a hard charging economy, put the Koolaid down. History always repeats.