The story about the Georgian was great. It made me chuckle, which is something I needed at this point of my morning.

I think there are three categories of borrowers. First, those who are most easily taken advantage of, e.g. people who don’t speak/read English well enough to understand what they are signing. There are some counter arguments to that, however. Do these people come from countries where there are no laws and where the concept of binding legal documents simply doesn’t exist?* I doubt it. Therefore, they still have the responsibility of somehow researching what they are signing. Also, I work for a large bank and we have a “Foreign Language Contact List” at our disposal, so that if a customer needs help understanding something, we can contact an employee who speaks their language to help. The list is comprehensive – I’m talking Assyrian to Yoruba and everything in between. (Creole? Yep. Bulgarian? You betcha. Even Sign, although it may obviously take some effort to get everyone in the same room.) So even this category of people can’t be totally absolved.

Second, people who know full well their payments will go up drastically, beyond what they can currently afford, but assume they will be making enough when the time comes. A big gamble. I’m sure it works out for some, but when it doesn’t, it’s both the borrower’s and lender’s fault for taking that risk.

Third, people who are fully able to read/research/understand what they are signing, but don’t out of laziness or misplaced trust in the broker or lender they are dealing with.

So to answer your question, the answer is “yes.” Always assume that when someone is trying to sell you something, they might not choose to be totally straight with you. That’s just reality, unfortunately. You might find that you actually ARE dealing with a trustworthy person, but why not double check before “signing your life away,” as you put it? No matter how many laws are put in place to protect the consumer, you can’t legislate against a slick sales pitch.

Lastly, even the most honest lender can’t predict with certainty what will happen a few years down the road. If a person bases his decision on speculation about what interest rates or property values or his personal income might be in five years, that, once again, is a gamble. The problem is that too many people on both sides of the equation decided it was a good idea to gamble.

Anyway, Cas, it was the phrase “no apparent reason” that caught my eye, and you probably didn’t even mean that 100% literally. (And yet here we are, five thousand words later.) And thanks guys for the “welcome back.” I got burned out on the whole idea of online arguing. Still am, really, but I felt like chiming in on this one.

*We had a guy from Georgia (the country) doing some sort of internship in my department a while back and he said his country does not have a credit reporting system like we have here. I asked him, “So how do you decide if you should make a loan, then?” He replied, “You look at the person’s eyes and you can just tell.” It’s amazing to think that it used to be done that way here, too.

Ninja Warrior rules.

Second, Ninja Warrior is freaking fantastic!

Third, I definitely agree that a huge portion of the sub-prime debacle is ignorant/short-sighted consumers. But most of these financial institutions took on substantial risk by ignoring their customers ignorance. And when both these parties screw up, the people that can actually afford their home (me) get caught in the middle because the market is in turmoil.

* A pretty easy-to-read document. You don’t have to be a lawyer to comprehend it. And if you want to actually research what you’re signing, there are resources.

Also, AG is okay, but Ninja Warrior is far superior.