Housing Crisis, Part II

It used to be, until the last few years, you had to actually save up for a house payment, and put down approx 10% of the actual appraised value of the house. Then it was 5%. Then the Bush appointees got into the act. Then 0% down would get you a house. Not content with reaping HUGE profits, the rules were changed again. You could actually buy a house, put NOTHING down, and finance up to 125% of the value of the house. If that wasn't bad enough, you didn't have to PROVE any of the income or assets that you claimed. You could also re-finance with the same (lack of) rules. Here in Colorado, gangs within prisons bought entire (nice) neighborhoods under these rules. All of a sudden we have a huge percentage of homeowners with NO equity, or negative equity in their houses. The actual loans were packaged, and repackaged and sold as collaterol to banks and investment companies. All along the way brokers, agents and the $$ people were getting huge kickbacks and commisions. It became obvious to certain regulators what was going on, and they tried to step in and do their jobs. Among them, Elliot Spiztzer, the gov of New York, tried to bring things under control. BUT, he found out how powerful the Bush appointees were/are......