My name is Ryan, and I am a 25-year old financial analyst living in Philadelphia. My professional background includes Investment Banking (formerly) and Private Equity (currently). Prior, I graduated from Swarthmore College in 2004 with a Degree in Economics. Many of my posts will be directed, for now, toward what I believe to be an enormous and growing problem in the U.S. - Housing and it's lack of affordability.
I'm writing in staunch opposition to any legislation that offers a bailout to irresponsible borrowers who over-levered themselves in order to purchase a home. All borrowers have a choice before signing on the dotted line. If a bailout occurs, it seems that once again congress will penalize the financially prudent with higher taxes (or a greater budget deficit) in order to reward the profligate few.
If money isn't involved in a bailout, legislation that makes foreclosure more difficult will penalize the lenders, who followed through on their contractual agreement in the first place and provide a valuable service to the economy. Much like onerous European labor laws that discourage hiring, I believe that such an action will discourage lending to a greater extent than any of us would like.
I believe we all have a right to the American Dream, but we have a duty to follow through on our obligations as well.
"Predatory Lending" is merely a symptom of a larger problem, that being a lack of affordable housing. The median income, in many areas of the country, cannot begin to afford a median house. Does anyone not see a problem here? This is what drives borrowers to take on more debt than they can afford. Housing must be allowed to correct in an orderly manner so home ownership is a reasonable proposition for all Americans.
Please keep in mind that there is a large and growing class of losers from the housing bubble that has nothing to do with mortgages and delinquency. It is the youth of this nation, ages 27 and younger, who never had the chance to buy a house during more affordable times (A "starter" house in many parts of this nation costs $1500 per month (more in others) , or more than half of the average person's take home pay. Keep in mind that much of this demographic is already saddled with debt from ever higher education costs. Just to add insult to injury, these are the lucky few who will bear the brunt of our burgeoning social security "time bomb." It is truly a great time to be alive.
It's not quite the Grapes of Wrath at this point, but frustration and discontent is growing among this group, myself included.