Westchester View

One of the primary problems facing the real estate industry right now is that anyone who needs loan has to have squeaky clean credit in order to qualify.   The number of Westchester homes for sale – that overhang of inventory – won’t go away until more buyers have access to credit.  During the boom, anyone with a pulse could get a home loan. Today the pendulum has swung too far to the in the other direction. Credit requirements are bordering on the absurd.  Lately I’ve been waiting for lenders to demand DNA samples  and FBI background checks for prospective borrowers.

It is true that in the past Americans have taken on a ton of debt.  With wages stagnant, unemployment high and families up against the wall – credit created the elasticity that kept many families living check to check afloat.  But the banks have been very mecurial  -  loving those who keep revolving credit balances and penalizing them at the same time.  The system has been set up with what Elizabeth Warren referred to as “tricks and traps.” The result has been a mess where banks jack up rates almost on a whim, change due dates, include non-usage fees and do anything else you can think of to wring more money out of the consumer.

Some of these new regulations regarding credit are designed to plug some of the holes. Of course the system is still full of holes you could drive a truck through. Jon Stewart had a wonderful take on all of this.

Here is the video – hilarious – particularly the second half.