What do you think? Home ownership - a right or a privilege?

Bloomberg BusinessWeek columnist Chris Farrell tells why tax policies and mortgage relief that artificially prop up home values are forestalling a real recovery

Read the article -  http://www.businessweek.com/investor/content/feb2010/pi20100226_589467.htm

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Home ownership - a right or a privilege?

I think people should be taught about:

- How Credit Scores are built and what risks there are to harming them

- How to have a long term plan to be self-sufficient, whether it be budgeting for today or planning for the golden years (saving 20% of net).

FHA got into trouble with their 3% down, not enough skin in the game.  Government can never do a great job underwriting 10s of millions of mortgages.  And they are guaranteeing them against default?

MBA (Mortgage Bankers Association) is playing "duty of care professor" saying "Honor your Obligations! see 

And TARP money is rescuing these same Mortgage Banks who wrote mortgages, made a profit, and sold the notes?

Compare this practice to Canada, whose banks manage and administer their own home loans, with no bail outs.  Their foreclosure rate is really low, probably due to prudent underwriting.  See http://www.businessweek.com/magazine/content/10_09/b4168072832439.htm

The Road to Hell is Paved with Good Intentions.  

The MBA allowed liar loans and other lovely tools during the boom (or Sen. Dodd (CT) and his boys did).

There is a Silent Tsunami of foreclosures coming in 2010 and 2011.  Especially with decrease of income and increasing of ARM payments due to resetting up 20% and more of current payment.

What do you think?  

I think we got a 3 - 5 year mess, and "propping up the real estate market" is just dumb.

Brian, REISkills