The Subprime Mortgage Crisis

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Recommended: U.S. Subprime Mortgage Crisis: Policy Reactions(b) conclusion

The subprime mortgage crisis

The argument over who is at fault for the housing market collapse has been a heated issue amongst government, politicians, banking institutions, and mortgage lenders. The subprime mortgage crisis is an ongoing financial issue and real estate nightmare for the United States economy. A dramatic increase in mortgage delinquencies and foreclosures has caused a significant adverse effect on banking institutions and financial markets. Due to this mortgage crisis, the housing market subsequently has crumbled resulting in a record numbers of home foreclosure and more are still looming in the horizon. For many, the dream of home ownership has become a real nightmare. Who is really at fault? Should minorities groups share part of the blamed for recklessly accepting these loans and later defaulting, realizing they can no longer meet their obligation? Should banking institutions, mortgage lenders, brokers, investors and credit bureaus be held accountable for this crisis? Should government share some accountability for their inaction and for not protecting victims of predatory lending?

An argument can be made that someone should be held accountable for the subprime mortgage situation. The main focus now is to preventing a continuous meltdown. The first step to cure the situation is taking immediate and corrective action. Kevin Alexander Gray states “We‘ve got to do more to stem the tide of foreclosures and stabilize communities throughout the country,” (Gary, 2009). In order to thoroughly understand the impact this crisis has had on the economy, it will be important to look at what has really prompted this housing meltdown. The immediate cause or trigger of the crisis was the bursting of the United States hous...

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... north. Human Events, 65(35), 1-10.

Dodd, C. U.S Senate Committee, Banking, Housing and Urban Affairs. (2007). Create, sustain,

preserve and protect the amercian dream of home ownership; stop abusive practices in the housing market Washington, DC: Retrieved from http://banking.senate.gov/public/index.cfm?FuseAction=Newsroom.PressReleases&ContentRecord_id=e2e529c0-29ee-43db-a314-ecafb3bdee32&Region_id=&Issue_id=

Gray, K. (2009, December). Fending off foreclosure. The Progressive, 29-30. Available from

Master FILE Premier, Ipswich, MA. Accessed March 3, 2011.

IBD. (2009, January 16). Fannie, freddie and now, hannie. Investor’s Business Daily. p.N.PAG.

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Stiglitz, J. (2008, September 17). How to prevent the next wall street crisis.

Retrieved from http://www.cnn.com/2008/POLITICS/09/17/stiglitz.crisis/index.html

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