Big profit banks using benefits from federal incentive program to reduce mortgage rates for themselves rather than helping consumers
October 13, 2012
It’s ironic and frustrating.
The American economy collapsed due to a hyped up housing market based on faulty mortgage packing and reselling. The crisis rippled throughout the world and its devastating effects continue.
Now, due in part to a federal program to encourage consumers
to buy homes, the housing market is picking up.
However, JPMorgan Chase and Wells Fargo, the nation’s largest mortgage lenders, said they won’t make home loans much cheaper for consumers, even as they reported booming profits from that business, according to an article in The Washington Post.
The reason why mortgage bankers are making so much more money is that the gap has widened between what banks charge a homeowner in interest rates and what they must pay those who finance mortgage lending, the article said. The mortgage-lending rate has dropped significantly, largely as a result of the Federal Reserve action of spending $40 billion a month to reduce mortgage rates to encourage Americans to buy homes.
American consumers continue to suffer from the financial collapse of 2008. Millions of people lost their homes. A job loss has meant that consumers who were able to own a home and provide for their families became homeless.
I don’t know what these banks and the big corporations are thinking. People need to have a job and a roof over their heads to be able to be functioning, purchasing consumers.
By greedy gouging continually, big business is driving consumers and their purchasing power into the ground.
You’d think these banks would be ashamed of their role in the financial collapse and want to adopt better business practices to help consumers and the economy recover and move American forward. However, it seems as though all they want is more money for themselves.
How much money do rich people need? Aren’t seven homes enough? Do you need a home with an elevator for your cars?
In addition to the collapse of the housing market due to greed, we’ve seen the recent savings and loan, dot-com, energy, and stock market crashes.
Unless big business adopts more ethical practices, we’re likely to see more.
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