As one who waited out the over-priced market for several years while also saving for a 20 percent down payment, I recently settled into a modest condo priced well below market price. With a solid credit rating, I stepped into a traditional 30-year fixed-rate mortgage, looking forward to the benefits of home ownership. I am concerned that those who purchased homes the old-fashioned way—with a solid credit rating and a traditional 20 percent down payment—might suffer from a general downward turn in real estate values.
The subprime lending market should be banned in order to protect the collective financial interests of those with traditional mortgages. The Massachusetts Division of Banks should not be looking to bail out or otherwise assist subprime lenders who have gone out of business. Home ownership is a serious responsibility—one that starts with a solid financial footing (down payment) and a good credit rating. Not everyone can or should be a homeowner; the rental market is readily available for those unable to meet the financial demands of homeownership.