License to get a mortgage ?

[HLS]

In this country, among other things and regardless of education, you need a license to get married, be a funeral director, handle food, sell a car, use software, go hunting or fishing, cut hair, drive a car, motorcycle or truck. You need permits to build or remodel, you pay a bunch of different taxes to fund oversight bureaus.

In Britain, you need an annual license for each TV that you own.

For a senior who has paid their home off, they need a class to get a reverse mortgage….

BUT if you can sign your name, you can get a loan for any amount of money, just because you want to.
Should you need to pass a test and get a license ?

It’s easier to get a loan than it is to get on an airplane!

[PerryChase]

Bravo! I’m all for that. And a license to get married also please! And a license to have children while we’re at it.

But the problem is you’ll all the diploma mills popping up. They’ll certify anyone who’s breathing. And who do you think will get the permits to run those private schools? Friend of politicians, of course. Are we going to have financial aid that will be funneled into private for profit companies as well?

Maybe a state board exam would be enough. If you can’t do NPV or IRR, can’t calculate property taxes, or cannot figure out the impound amount, then you can’t get a mortgage.

[PerryChase]

Bravo! I’m all for that. And a license to get married also please! And a license to have children while we’re at it.

But the problem is you’ll all the diploma mills popping up. They’ll certify anyone who’s breathing. And who do you think will get the permits to run those private schools? Friend of politicians, of course. Are we going to have financial aid that will be funneled into private for profit companies as well?

Maybe a state board exam would be enough. If you can’t do NPV or IRR, can’t calculate property taxes, or cannot figure out the impound amount, then you can’t get a mortgage.

[betting on fall]

The difference between a mortgage and many of those things you mention that getting a mortgage should be a self-regulating transaction. If I have $400,000 to lend, I am going to make sure the person getting it has the ability to repay and adequate collateral in case they don’t. I don’t need to government to tell they are a good risk.

Things went wrong when there was a complete disconnect between those approving loans and those bearing the risk of bad loans.

[betting on fall]

The difference between a mortgage and many of those things you mention that getting a mortgage should be a self-regulating transaction. If I have $400,000 to lend, I am going to make sure the person getting it has the ability to repay and adequate collateral in case they don’t. I don’t need to government to tell they are a good risk.

Things went wrong when there was a complete disconnect between those approving loans and those bearing the risk of bad loans.

[PerryChase]

i agree with betting.

In all seriousness, a mortgage is a private transaction. Lenders will automatically develop the proper business models to be profitable — that is if the government stays out of it. Any bailout (taxpayer subsidy) will be incorporated into the future business model.

[PerryChase]

i agree with betting.

In all seriousness, a mortgage is a private transaction. Lenders will automatically develop the proper business models to be profitable — that is if the government stays out of it. Any bailout (taxpayer subsidy) will be incorporated into the future business model.

[HLS]

Of course,, but what happens when the responsible borrower of $400K gets into trouble or the $500K item that you loaned $400K on becomes worth $250K ?

Thirst for above market returns creates a crazy risk/reward structure.

Institutions offer comepetitive rates, that are FDIC insured to get deposits, and then can lend out multiples of the incoming deposits to what could become risky loans.
Leverage is everyone’s friend on the way up…

Watch out below on the way down. The original deposits are backed by taxpayers.

[HLS]

Of course,, but what happens when the responsible borrower of $400K gets into trouble or the $500K item that you loaned $400K on becomes worth $250K ?

Thirst for above market returns creates a crazy risk/reward structure.

Institutions offer comepetitive rates, that are FDIC insured to get deposits, and then can lend out multiples of the incoming deposits to what could become risky loans.
Leverage is everyone’s friend on the way up…

Watch out below on the way down. The original deposits are backed by taxpayers.

[guitar187]

As a mortgage professional I would have to say that it would be a great idea. But, who would make the test? Government regulators? Hedge fund managers?

[guitar187]

As a mortgage professional I would have to say that it would be a great idea. But, who would make the test? Government regulators? Hedge fund managers?

[NotCranky]

The mortgage people are required to have licenses, those working in banking/investment banking, many more credentials, what good did that do?The Realtor feeding the sharks has a license too. All of them were enabled by some of the most highly positioned and credentialed in our society. Saying that consumers should have to get licenses to borrow, is not a bad idea in itself, but this happened becaused the already licensed and credentialed players wanted it to happen or played along with or without ignorance and they didn’t give a damn what happened to the little unlicensed “consumer” or the economy.

If we looked at people when they came to us for services and said to ourselves “What if this were my son or daughter, what if this were my brother or sister, what if this were my father or mother” that would have been another way to have sidestepped the bubble.
I am not saying individual debtors are not responsible but they are clearly the ones most entitiled to play the ignorant card. I hope they don’t cause themselves more trouble than they have to over it.

[NotCranky]

The mortgage people are required to have licenses, those working in banking/investment banking, many more credentials, what good did that do?The Realtor feeding the sharks has a license too. All of them were enabled by some of the most highly positioned and credentialed in our society. Saying that consumers should have to get licenses to borrow, is not a bad idea in itself, but this happened becaused the already licensed and credentialed players wanted it to happen or played along with or without ignorance and they didn’t give a damn what happened to the little unlicensed “consumer” or the economy.

If we looked at people when they came to us for services and said to ourselves “What if this were my son or daughter, what if this were my brother or sister, what if this were my father or mother” that would have been another way to have sidestepped the bubble.
I am not saying individual debtors are not responsible but they are clearly the ones most entitiled to play the ignorant card. I hope they don’t cause themselves more trouble than they have to over it.

[sdduuuude]

Yay. more laws & government oversight.

[sdduuuude]

Yay. more laws & government oversight.

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