Do Homeowners Share Blame for Mortgage Mess?
Many Americans were living beyond their means when they purchased homes.
Oct. 7, 2008 — -- Most Americans aspire to own their homes.
"And when somebody makes it very easy for you to do it by saying you don't really have to put up my money, or 'we'll give you 100 percent mortgage,' you're going to do it," billionaire investment guru Warren Buffet said on "The Charlie Rose Show" recently.
More Americans than ever have become first-time homeowners in the last decade. It's become increasingly clear, however, that many of them couldn't keep up with home payments. And they are now facing foreclosure.
Despite the school of thought that many homeowners brought disaster on themselves by living beyond their means, banks and mortgage lenders are taking much of the blame for offering subprime mortgages and risky loans.
"Everybody looks for the American dream, and they do what they can do to get that dream, and for us we thought we were going to be OK," New Jersey homeowner Mary Jane Byrd said.
But she and her husband, Kerry, are far from OK, facing the prospect of foreclosure on their dream home.
Byrd says the blame lies squarely with Wall Street not regular families like hers, and she isn't a fan of the government's $700 billion bank bailout package.
"I don't feel it's necessary for us to have to bail them out. They should be taking care of us, the people who they have wronged," she said.
Not all homeowners agree. Leah Talley took a loan out for a home she knew she couldn't afford.
"There was this little voice, little Jiminy Cricket voice going, 'Don't, don't do this,'" Talley said. "They valued that loan at too high of a value. I went ahead and did it anyway."
But Talley says she's not asking for help. "I didn't go to the government and say, 'I am losing my home, I think you guys should bail me out.'"
Both Talley and the Byrds agree, though, that they've let down their kids.
"I made a promise to my kids," Kerry Byrd said. "Right now they have a place to live but for how long? Once we get ourselves back on our feet we won't be in this predicament ever again."
More than 400,000 Americans facing foreclosure will get a lifeline after Countrywide Financial reached an $8 billion settlement with 11 states to help those homeowners rework their mortgages.
