Extreme Makeover has been a very popular show. It’s enjoyable to see people who are down on their luck get a chance at a nice place. For some of the recipients though, a better home has brought an unwelcome side effect– foreclosure:
I can’t help but wonder if Extreme Makeover isn’t a miniature example of subprime lending. EM is helping people get into homes they couldn’t possibly afford. These people either can’t handle the associated bills, or are allowed to borrow more than they can possibly repay against the home.
Euclid, a tutor to King Ptolemy, once said,"There is no royal road to geometry" when Ptolemy requested that Euclid make the subject easier. We might want to consider that there is no royal road to homeownership either.
Unlike some claims, homeownership does not cause prosperity. Homes–even those that are owned free and clear–are demanding responsibilities. They are not money makers. Renting is often the better deal.
Let us consider the poor beneficiaries/victims of EM receiving a home beyond their means when considering policies that advocate easy lending. The road too often leads to foreclosure
i’m pretty sure i saw an article a few months back in the republic about the family that got a home makeover here in the valley. foreclosed.
Man I just saw the one in Alaska with the mom raising God knows how many kids living in a 900 sq ft shack. They built her a 5,000 sq ft castle!! Being on welfare as it is, how can she possibly be able to pay the property taxes, let alone the much higher utilites (heat especially) associated wth a house that size? She will be pulling a huge equity line and running for the door soon enough.