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Having trouble getting a home loan?

Original post made by Megan Rawlins, Palo Alto Weekly, Another Palo Alto neighborhood, on Aug 22, 2008

We keep hearing that potential buyers may be running into problems nailing a home loan. Anyone out there who lost a house because they couldn't get the loan secured in time? Please reply to mrawlins@paweekly.com.

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Posted by Perspective
a resident of Midtown
on Aug 23, 2008 at 5:53 am

This is a completely predictable response to the overblown fear engendered by the subprime mortgage "crisis". All lending institutions are clamping down in lending to developers AND potential buyers, not knowing where the next regulation beating is going to come from.

If we hadn't over reacted, we could still be getting loans to buy houses.

The real irony is that the ones who are most hurt by this are those the subprime helped the most,...those with less. More minorities and lower middle-class families own homes now than ever in the history of the WORLD, let alone the USA. By focusing on those people who planned poorly or got in over their head, and making "someone pay" for their poor judgement, we froze the risk taking ability of lending institutions. We also implemented a downward spiral in home values as people stayed put instead of moving upward, causing those of us who bought homes to lose value in our homes. In other words, all the hysteria hurt us more than the actual issue.

That trend is in reverse now. And the benefits of the sub-prime that far above and beyond outweighed the negatives are going to finally come out in media.


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