Don't mess with mortgage economics

Don't mess with mortgage economics
August 19, 2007

The No. 1 key to a capitalist society is that failure, foreclosure and bankruptcy are good for the economy, by making the value of homes come down and weeding out predatory lenders.

Now there is a glut of affordable homes for sale, along with many used items still of value, that the economy will absorb at reduced rates that make it stronger and more profitable over time. Real estate investors can pick up rental homes and other items at discount rates that make them more profitable.


The pandering by U.S. Sens. Chris Dodd, D-Conn., and Charles Schumer, D-N.Y., or state Sen. Hansen Clarke, D-Detroit, that government should prevent a natural revaluation of the real estate market is preposterous and misleads consumers into thinking subprime lenders did something wrong, when, in fact, the federal government kept long-term interest rates low until it could pass the bankruptcy reform act.
To blame licensed lenders for the bubble popping in the housing market is ignorant and does not consider all of the economic factors that happen naturally.

Tom Baker

Sterling Heights

More cooperation needed

Before I can recommend federal aid to help the lenders, I would like them to show a bit more effort to assist in preventing the continuation of the crisis ("Foreclose this crisis; Federal policy can save some homes and help prevent another mortgage mess," Aug. 12).

Hopefully, by now you have seen the success that our first-in-the-nation mortgage/deed task force has achieved in Wayne County. In 2005, I funded staff from the sheriff and Wayne County prosecutor to join my staff in the register's office; 100% of their combined investigative effort is directed to stop this fraudulent criminal activity, much of which leads to foreclosure. Thus far, we have opened 345 cases, returned 80 properties to rightful owners who had them stolen, and placed criminals in prison, attaining a 100% conviction rate.

In July, I was infuriated to be rebuffed by a large California lender who refused to identify a local appraiser, a title company representative or a local lender representative. I asked for these loan team members who were instrumental in closing a loan of $2 million on a Grosse Pointe property they confirmed was a first-payment default.

Until I see more cooperation from the industry, I hope our tax money is not sent to correct their bad business decisions.

Bernard J. Youngblood

Wayne County register of deeds

Detroit