Realtors Behind the Scenes of Our Economic Mess
I often wonder why Realtors haven’t received much of the blame and scorn for their role in the inflation and collapse of the real estate bubble. As much as the banks are accused of predatory lending to simpleton home buyers, why aren’t Realtors targeted as well?
We all know that California has been a real estate disaster of epic proportions. For many years, California law has allowed homeowners to walk away from their home and mortgage without being obligated to pay any deficiency amount after the foreclosure or short sale.
The problem is that the law does not apply to a refinanced loan or home equity loan. This means that all of those Californians who used home equity to finance their lifestyle were stuck with paying what they had promised.
“Unfair” say the Realtors. If the lenders are bothering these ex-homeowners to pay what they had borrowed, they will have a hard time re-entering the housing market.
Red alert! Realtors want everyone borrowing and buying again. Who cares about careful borrowing and personal responsibility? There are commissions to be made!
So of course the Realtors are behind a pending bill that will extend the “no recourse” loan protections to everyone in California. It is time to re-inflate the real estate bubble.
Have you ever noticed on those house-hunting shows on TV that the real estate agents almost invariably show the buyer a home that is above their price range?
Have you ever heard a Realtor tell a buyer: “Wait – stop – you can’t afford that! ”
You are more likely to hear “Can you borrow the down payment from someone in your family?”
Here is a link to the article in the New York Times.
Don’t you think that Realtors need to own some of our economic mess?