Friday, August 24, 2007

Subprime, Sub-smart

I am sure that there are few things more devastating, financially speaking, than losing one's home. Because of that, I am hesitant to criticize those who are now in a mess due to large numbers taking out subprime adjustable rate loans, but wasn't the current national crisis entirely predictable?

I know that people like this will say so.

In 2003, interest rates were at their lowest level that they've been in my lifetime -- I bought a house that year and locked in a fixed rate of 5 and 3/8%. When rates are at the bottom, there is no place that they can go except up. Getting an adjustable rate mortgage under those circumstances was just not smart.

I apologize for blaming victims, but many of the people affected by this really should have known better.


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