The subprime mortgage foreclosure crisis has presented a very unique opportunity that two groups across the nation are taking major advantage of.
The ‘crisis’ came about primarily because Fannie and Freddie relaxed their qualifications for obtaining a mortgage. People who 10 years ago would not have qualified (because they had no down payment and didn’t have sufficient income and job history), have been able to qualify under the new relaxed rules. Lower end neighborhoods across the country were flooded with these ‘subprime’ borrowers over the past few years. All of these people suddenly able to get loans (that we now know many could not afford) and becoming home buyers drove prices up in marginal neighborhoods and people who previously had no interest in selling suddenly were being offered enough money that selling became appealing.
Neighborhoods that were once relatively stable became filled with subprime borrowers who couldn’t make their payments and were foreclosed on. This resulting in entire neighborhoods with sometimes 50% or more of the homes on the market all at once and many for very low prices.
Muslims wasted little time with this opportunity. In some cases local mosques informally coordinate the selection of target neighborhoods for families to begin buying in to. In other cases a more formal representation group has worked with local housing authorities to assist with Muslims buying numbers of houses within a defined area.
GLBT folks were a bit slow but are quickly catching up. In some cities they’re hosting day long open house events in neighborhoods with realtors and housing authorities. All of the available properties are open for inspection and in many cases local GLBT groups or others provide wine and cheese to make it a truly enjoyable event.
3 comments:
Sorry for the late response. Had left this post open in a tab to read when time permitted.
I must admit I am not catching what you're getting at here.
The biggest problem in the sub-prime market was ARM's taken out as 2nd's to cover the down payment required on the 1st mortgage.
The federal program / initiative I am aware of provides fixed rate loans to eliminate the higher rates those ARM's jump to often.
I do not agree with offering a select group of idiots a bail out, one not open to all, but it does delay or eliminate the damage such loans do to all of the market.
With that said, it should help to stabilize market prices somewhat, preventing a rush to sell more homes.
As for the Muslims & gays being benefited, I'd think any home they could buy would be open for anyone else to offer to buy it.
What am I missing here?
I think you and I are in agreement. Bailouts are generally a bad idea and besides just delaying the inevitable, encourage irresponsible behavior (by consumers, CEO's and everyone else).
You may be reading too much in to this post though. I wasn't making a point, only mentioning something that's been taking place in a number of cities across the country. Just about every major metro area (of the top 30 or so) has neighborhoods where there are huge numbers of foreclosed houses. Muslim and GLBT groups are taking advantage of this to have a number of people within their group purchase these homes and effectively create a neighborhood of predominantly one or the other. EG, a neighborhood of predominantly Muslims or of predominantly GLBT's.
I probably could have written it better. Sorry 'bout that.
No apology needed!
I just did not see how any select group had an advantage over another, or any one actually.
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