Credit counselors are bracing for the continuing fallout from the expected 1-3 million foreclosures during 2007.
“Oh Lord, there is no way we can keep up with these calls,” said Kaye Britton, a foreclosure counselor at the downtown nonprofit group that promotes home ownership to minority Americans, among others.
Really, the heart of the problem, as some have pointed out in the comments, is that banks should have known better. But the market was hot, they got carried away, and borrowers just followed the advice of their mortgage brokers. Things steamrolled, and here we are. The subprime lending fiasco is costing everyone money except the mortgage brokers who originally wrote the loans so they could walk away with a quick broker fee. What isn’t quite clear is why the banks haven’t sued the brokerage firms who knew exactly what they were doing when they engineered this mess by “helping” borrowers into loans they couldn’t afford by misstating incomes and fudging numbers. — SAM GLOVER