On non-prime mortgage borrowing, home ownership, and foreclosure...

I'm all for equal opportunities. It's probably one of the biggest selling point of America where everyone is supposed to have a fair go (or at least the hope and look of a fair go).

The push towards increased home ownership during the boom years, from Bush (remember the "Ownership Society"?) on down, to everyone in the mortgage and financial food chain, including of course, the great enforcer of Alan Greenspan who had made it all possible, with the prolonged period of super-low interest rate and easy money.

The argument goes, when someone else is having a house, everyone should have one too. So goes the push for lower-income, sub-prime, non-prime, and whatever name you call those groups who were on the outside looking in on the housing boom, in which everyone's SUPPOSED to own their homes.

What's wrong with that picture/argument, anyways?

There is this case study/report in Wall Street Journal of this phenomenon back in the housing boom when state officials were all the rage in pushing for easy credit to the Latino community, which is now facing particular hard times with foreclosures, amid falling housing prices and slumping economy.

I don't think anyone would argue against the discriminatory practice of redlining in which minorities are denied credits. Sometimes, when you're down low in the ladder, all you need is a break and you can move up. At least that's the hope. But as the article has noted, one of the things that happened during the housing bubble years was the reverse redlining in which minorities were targeted for easy credits. When people are pushing money into your money, I don't think anyone would push back. But of course there would come a time when you need to pay back; or in the case of the property market crash, the once-lofty home ownership becomes a dead-weight.

The keyword of all these is sustainability. I'm sure somewhere at the back of the minds of those (supposedly) Hispanics non-profit foundations and state officials, there had once been the hope to genuinely help lift the boat of Hispanics when the tide was high. It's not that they didn't deserve that break (of allowing the credit/mortgage). But if it's not sustainable, you're simply setting up the traps for these minorities.

The other keyword is the implied entitlement mentality. Does everyone deserve and entitle to own their homes? While it would be nice to think so, whether they're ready to own a home, thereby assuming a huge debt from a long-term mortgage, could do more harm than good, as the reality now show us.

In the blogosphere, there're more than enough postings of local Americans who would proclaim to be the ultimate, prudent American, who would not live beyond one's means. Whether they are indeed one or not, is not my concern. But the idea of that is very valid.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

To give an analogy: Most everyone drives. So it goes that, since everyone's driving, we should let kids, however young they are, the chance to drive. Afterall, every adult is doing that, isn't it!? So, the argument would go that, you should let kids drive, no matter how young they are, since it's a matter of "fairness." Before long, you have wreckage and carcasses on the roadside everywhere, because you let them drive, even though the kids don't really know how or don't know what they're doing. When you arrest the kids, they claim innocence. Afterall, you *let* them drive, don't you? You give them the car, you push the key in their hands, and you fill up the tank to make sure the car moves. YOU are the one causing it, as the kids claim, and not them.

So...do you let the kids off the hook for causing the wreckage, or do you kick yourself in the backside for letting them do it in the first place?

Should we have waited until the kids are big enough, and show enough prudence to pass a driving test before they're allowed to drive? For those who have allowed the young ones to drive, should they go to jail instead? Who should pay for the damages?