This is basically humorous.

On May 10th, 2007 the Boston Globe actually said that the credit repair industry is responsible for the sub prime mortgage problem sweeping the nation.

Why?

Supposedly the credit repair industry did such a good job, too many people were able to get mortgages.

I suppose this is a “back handed complement” of sorts that proves that to get a fair shake at a reasonable mortgage rate these days, ordinary consumers need professional credit repair help!

In reality the issue was not the credit score alone but the fact that the lenders did not document the customers’ ability to repay based on verifiable income.

FICO scores should be seen as a guide to the consumers propensity to repay and do not either verify or indicate the consumer’s income.

And - by the way - part of the issue has been the mortgages issued with no down payment whatsoever and therefore no potential loss to the borrower… it’s no worse in some ways emotionally to walk away from a rental property than a 100% mortgage because there’s no 10% or 20% downpayment to be lost.

But since we’re looking for scapegoats, why not blame the credit repair industry?

This entry was posted on Saturday, September 8th, 2007 at 2:52 pm and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.