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Yeah, and no one forced the banks to take on the risk of handing out $300,000 worth of credit to a family pulling in $80,000 annually.
It would seem to me, dogzilla, that you have conveniently left out the bank's own responsibility in the matter. Of course, at the time, to them, home equity as collateral was a "sure thing." They didn't expect home values to crap out, so to them the risk wasn't as great as they thought it was.
Real estate is awesome and it's so great being able to repossess it if need be. So hand over $300,000 in credit to an $80,000 family. Make as much money off of them as you can, right? What could go wrong?
It sounds to me like greed is a two-way street.
I will chastise borrowers for borrowing that kind of money for cars and boats while putting their homes on the line. But I don't blame them for not wanting to lose their homes.
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Knowing that death is certain and that the time of death is uncertain, what's the most important thing?
—Bhikkhuni Pema Chödrön
Humankind cannot bear very much reality.
—From "Burnt Norton," Four Quartets (1936), T. S. Eliot
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