A Catastrophe Housing Crisis Essay Example | Topics and Well Written Essays - 750 words

A Catastrophe Housing Crisis - Essay ExampleThe astonishing part ab expose this is that amidst this crippling crisis, no one truly has an astute collar of how a simple subprime mortgage flap has caused so much life-changing damage. This holds particularly true for the embattled homeowner, who was bombarded with highly technical instruments without being duly informed of its potentially damaging ramifications. My uncle was one of those gravely affected by the mortgage crisis. He was always an upstanding, responsible guy, and a few days ago he proudly announced that he had taken out a mortgage for a nice new property, the culmination of all his hard work and efforts. Some in our family were particularly wary as to how he got the home loan, as he gone through a rough financial patch some years back. He proudly stated that the bank was very kind to him, and had worked out a special deal for him so he could buy his house. I understandably remember having a conversation with him where h e was really hyped about this newfangled instrument called a subprime loan. He boasted about how the bank gave him a really low gear interest rate for the first year, and that succeeding years would depend on how the prime rate would hold up. I asked him how sure it would hold up, and that it wouldnt skyrocket. He tell he was assured by the banker he was talking to that it was the perfect time to take out a loan because the market was very stable and wasnt sacking anywhere in the next couple of years.When the prime rate went through the roof, the increase in my uncles monthly amortization became exponential. He simply could not keep back up with the payments , he was only earning so much to support himself and my three cousins. As the bills piled up, he had no choice but to let go of his dream home. The bank is starting foreclosure proceedings on his home, and I often catch him staring blankly into space. When prodded with what went wrong, all he could tell me was They never tol d me it would turn out this way.Quite frankly, they never expected that it would turn out this way either. An article in the New York Times (2008) argues that your confusion is shared by many pot who are right in the middle of the crisis. (p.14.) Even top analysts and brokers are lost amidst the extreme complexity of the instruments used. Now, if even the experts do not grasp the crisis fully, what more(prenominal) for the ordinary homeownerWe have to understand that we are dealing with an issue that ran so deep that once the bubble burst, everyone from the bottom up was hit hard. Its ramifications were far-reaching, extending far beyond domestic shores. According to Dattels and Antonshin, (2008), Over the next few years losses are expected to reach the $900 billion mark, and banks and financial institutions everywhere are scrambling practiced to keep their head above their water. (p.9)So who could blame my uncle for not knowing what hit him, when the experts themselves were comp letely lost as well. Could he be completely cursed for his seeming ignorance, when everyone else was in the same boat.