Should we support a mortgage bailout?

My answer is a resounding NO! I know, I know, as a real estate agent I imagine I’m supposed to support this, but I’m a rabid “free-marketer” first and a real estate agent second. Selfishly speaking I already pay too much in taxes and am subject to some ridiculous regulations. For those who are in a lower income bracket and want to become home owners, increased regulation and lender liability, that a mortgage bailout will bring, will only hurt them and freeze these folks out of the home buying market.

The Denver Post had yet another article this weekend featuring some poor, downtrodden couple who was suffering under the weight of adjusting mortgage rates. This elderly couple who should have already paid their entire mortgage off, instead racked up numerous credit card debts and refinanced their house multiple times. A house that they bought for $57,000, 30 years ago, now carries a debt of $300,000.

The article goes on to point out that 85% of subprime mortgages are still being paid on time. Why not tell the story of ONE of those 85% who were able to buy a home that they wouldn’t have been able to buy previously? Because that’s just not as much fun! (Note that over 97% of mortgages overall are currently being paid on time, but the media isn’t going to emphasize that either because if it bleeds it leads, and 97% just isn’t very bloody.)

HR3915 the Mortgage Reform and Anti-Predatory Lending Act of 2007 enacts stringent new rules for mortgage underwriting and mortgage brokers that will ultimately make mortgages more expensive and harder to get for everyone.

Mortgage brokers who pushed loans through for folks they knew couldn’t afford them were irresponsible and greedy. By that same token, folks who borrowed that money, thinking they’d “gladly pay you Tuesday for a hamburger today” were also irresponsible and greedy. Unfortunately if HR3915 or some other over encompassing reform is passed we’ll ALL pay for it.

Real estate professionals who support this type of legislative reform now, because it will appear to make things better in the short run, will only decrease their potential pool of clients in the long run.

Beth Skinner is a real estate professional who actually returns phone calls and emails! Click here to search the MLS for your dream home.

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