Subprime Mortgage Crisis

Unless you have been on another planet you are very aware of the crisis happening in the housing market. People who probably should not have qualified for a loan to buy a house were approved. Many were given loans that had an adjustable interest rate. At first it was low and the payments were manageable, but at a certain point the interest rate went up and people then found themselves with a house payment they could no longer afford.

Consider the following news report:

U.S. foreclosure filings, bank seizures surge

Bloomberg

May 15, 2008

U.S. foreclosure filings climbed 65 per cent and bank seizures more than doubled in April from a year earlier as mortgage industry efforts to modify loans fell short. More than 243,300 properties were in some stage of foreclosure, the highest monthly total since RealtyTrac Inc., a seller of default data, began in January, 2005.

One in every 519 households received a filing and Nevada, California and Florida had the highest rates. Filings rose 4 per cent from March. Bank repossessions jumped 145 per cent in April from a year earlier to 54,574, according to Irvine, Calif.-based RealtyTrac.

Banks will seize about 60,000 properties a month through December, when about one million U.S. homes, or a quarter of all homes for sale, may be bank-owned, Rick Sharga, RealtyTrac's executive vice-president of marketing, said in an interview. Voluntary programs to change loan terms for at-risk borrowers haven't helped enough people, said Ira Rheingold, executive director of the National Association of Consumer Advocates in Washington.

Greed is defined as:

A selfish and excessive desire for more of something (as money) than is needed

Banks wanted more money, people wanted larger and nicer houses then they could really afford. The results of this are banks and people are now in trouble!

The bible calls us to a different way of life:

1 Timothy 6:

6 But godliness with contentment is great gain.

7 For we brought nothing into this world, and it is certain we can carry nothing out.

8 And having food and raiment let us be therewith content.

9 But they that will be rich fall into temptation and a snare, and into many foolish and hurtful lusts, which drown men in destruction and perdition.

10 For the love of money is the root of all evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows.

11 But thou, O man of God, flee these things; and follow after righteousness, godliness, faith, love, patience, meekness.

12 Fight the good fight of faith, lay hold on eternal life, whereunto thou art also called, and hast professed a good profession before many witnesses.

Yesterday on my I-pod I listened to an amazing show that explained the current Mortgage crisis better then I have ever heard!

Here is the information about the program:

A special program about the housing crisis produced in a special collaboration with NPR news. We explain it all to you. What does the housing crisis have to do with the turmoil on Wall street? Why did banks make half-million dollar loans to people without jobs or income? And why is everyone talking so much about the 1930s? It all comes back to the Giant Pool of Money.

You need to take the time today to listen for yourself. As you listen think about the passage of scripture I quoted above.

Here is the link to the program:

Mortgage