Forget the Joneses

For the past two months we have been hearing about banking collapse, foreclosure and slumping home sales.

Many banks have been dubbed predatory lenders. Yes, they gave a first-time homeowners a fixed rate for 20-30 years, then a few years later, the homeowner took out a home equity loan. That money is spent on new vehicles, trips to Disney, jewelry, etc. to keep up with the Joneses.

Now the homeowner has two mortgages, credit card debt and wants to refinance the whole shebang. The banks rightfully look at them as a risk.

They are offered a variable rate and as the interest rates go up so does the monthly payment. They now cannot afford the payment and want to blame everyone but themselves for their problem.

The banks should have required the homeowner to show a reinvestment of 80 percent of the loan to secure the value.

Until the materialistic people of this country change their spending habits, we will always have these problems. Solution: Stop spending what you don’t have and to heck with the Joneses.

Susan Lara

Eastport