Airline Credit Cards

By Kelly Kilpatrick

With an unofficial recession in full swing, and the government geared up to bail out major financial institutions, many consumers are finding themselves in a situation they never thought they’d find themselves in.  Credit damage for many families has created a woeful economic climate, with little on the horizon for the little guy who’s been as deeply affected as the financial institutions—only with far less recourse.

Predatory lending and lender optimism, along with lowered standards for mortgage qualification led us into the slippery slope upon which our economy now teeters, but who ends up footing the bill when all is said and done?  The taxpayers are now helping out companies that continue to gouge the very ones that are now helping to keep them afloat.

Starting a few years back with the philosophy that every American deserved to own a home, banking loosened up the eligibility requirements to obtain mortgages.  Banks were given incentives for helping boost our housing market, and an unusually optimistic lending market was born.  When the dust settles, surely there is far more to the story regarding this boom in mortgage lending.

Perhaps what was really going on was that financial institutions were lending money to people knowing full well that these people would default, and the banks would be able to foreclose and resell the homes again, achieving these same results.  It would be nice to think that these sorts of practices were not going on, but upon taking a closer look, it is obvious that the banks were only looking at the dollar signs, not really trying to help people get into homes.

Naturally, banking is a business and business is about making money.  However, predatory lending—qualifying people for seemingly good loans that rose exponentially after the fixed rate term expired—is what got this whole ball rolling.  Many who qualified for mortgages were barely able to pay during the fixed rate term of their loans.  Once the payments went up, these people were unable to pay, with little or no knowledge of how to improve their situations.  

Now, the government is bailing out these financial institutions.  What about the growing homeless population and the affect this mortgage crisis has had on debtors nationwide?  Should different criteria be developed for consumers who are trying to get back on their feet, but are unable to do so because of tarnished credit records?  These issues must be addresses before the current state of the economy graduates from recession to a full-blown depression.
 

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