@squirrel
I am basically providing the subtext behind the entire sub-prime lending practices.
Like I've said before, it wasn't that poor couldn't afford their homes, but that many lenders were including language in the contracts that pretty much (over time) landed the borrower in default if they were a month late in payments.
It was the penalties that did it, not the lending.
I've known more people that have gotten bad credit from spending 40$ in one day.
My first bad credit experience: Bank of America
19 purchases in one day, most of which for less than 5$, landed me 700$ in overdraft fees. Nevertheless I made 150$ a week, and was in school, and my rent was 400/month. Guess what happened to me.
It was usurious behavior like this, that has left the housing economy in shambles, not the consumers.
It didn't collapse under it's own weight, but from banks looking to make more money.
Banks are given permission to do whatever they want as long as the customer signs the contract (even without reading it or being informed)
