Last night, President Obama was elected to a second term. It was not my vote, but that’s how democracy works. From what I can tell, his supporters feel like he cares about them and understands their needs.
But here’s how I see it:
In 1999 I started working for a local homebuilder. My job was to oversee the contracts, order the correct upgrades, keep the field agents up to date, and make sure the mortgage company and lawyer’s office had everything they needed to close on time. I loved my job! (It is also where I met my husband… so that was like a little bonus!)
About 6 months into my work there, I began getting offers on houses that included a form stating that the builder agreed to pay all closing costs. Not only that, the builder also agreed to pay back a 1% fee to this new government program designed around the idea that “everyone deserves a home”.
Confused… I asked the real estate agents about it. They explained to me that this was a program started under the Clinton administration to make sure every American has a chance to own their own home. And under the program rules, all the builder has to do is increase the cost of the home to cover the expenses of the closing costs and 1% government fee.
It seemed a little strange to me. I mean, doesn’t everyone already have the opportunity to own a home? Get a good job, save enough for a down payment, and maintain a decent credit score. It’s the same rules for everybody.
At first we only received a few of these offers. But once word got out, it seemed like every other contract had a government form attached. There was one subdivision in particular, our most inexpensive homes, and probably 90% of buyers in there wanted to be a part of this program.
I remember one day going into the office next to mine, where the girl did our accounting, and discussing the long term affects of such a thing.
“Janeen, these people are going into new homes that are upside down. They are worth less than the loan amount. I can’t believe the banks are agreeing to this. What is the incentive for the homeowner to maintain the home? Or pay the note on time? They have absolutely nothing invested. I’ll bet you anything that entire subdivision is foreclosed in 5 years.”
Foreshadowing? Perhaps. But I didn’t realize it at the time. The homebuilding business boomed for the next 7 years. We could barely build them fast enough. “Everyone deserves a home” became the norm and it was rare to accept a contract the old fashioned way. With a down payment.
A few years into my job as construction coordinator, I decided to venture out into the world of home mortgages. It seemed like a natural progression to become a loan officer. Afterall, my husband was building the houses. If I could get the mortgage, we could keep it all in the family. Cha-ching! Right?
Well, after less than 6 months, I quit. I don’t care how much money we could make, it wasn’t worth it. I couldn’t sleep at night. Even after already working with homeowners and mortgage companies in the years prior, I was shocked to see exactly the carelessness being placed on homeownership.
I worked with several potential buyers. I saw their credit reports. And I’m not judging them, but they needed help. It was obvious they had not been taught how to manage their money. Yet, “the rules” stated they were eligible to own a home. And not just any home, because by this time, we were no longer talking about starter homes. They were putting contracts on houses in the $250,000-$300,000 range with all the upgrades! And this was perfectly legit?!?!?!
I felt like I was setting these people up to fail. Sure, maybe they could make their house payment, but what about food and electricity and all the credit card debt they were only making the minimum payment on? How were they supposed to furnish their home? And pay the yearly homeowners association dues? I truly saw the heartless side of the financing industry.
In 2007, we all began to see the effects of greed portrayed in the light of “entitlement”. What I projected would happen in a small subdivision in Georgia, happened all over the United States. It’s sickens me to think that if someone like me, with no more than a high school education, could figure it out, certainly those with their Ivy League diplomas knew what was coming. And yet did nothing to stop it.
For the past 4 years I’ve thought it unfair that George W. Bush has been blamed for the economic crash only because it happened during his term. The program that started it all, was approved under Bill Clinton. But up until recently, I did not know who the person was that fought to make “everyone deserves a home” a reality. He was a young ambitious lawyer out of Chicago. None other than Barack Obama.
Hmmmm… now that’s interesting, isn’t it? As he continues to show frustration over the debt he inherited from Bush… he is partly to responsible for it. As he continues give away more entitlements… he again, isn’t solving any problems. What if, instead of concentrating his energy on a program that GAVE everybody a home, Obama would have put about programs to help people manage their money? Then people could have worked hard, bought their house, and had the ability to KEEP it.
How can a person say he cares about people when everything he does keeps them in a constant needy state? Think about Obama’s childhood. Single mother. Poor family. He had to break many barriers to get where he is today. But instead of using that to help others free themselves from the same cycle of poverty, he does everything in his power to keep the ball rolling. And they love him for it.
I just don’t understand.