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When I started looking (with no chance of putting together a down payment for 5 years or so) for houses, I stepped into a strange and surreal world of extremely friendly people who gave me, even then, a sense of doom. The day I walked into a real estate agent's office, she told me that I could get a loan with 0% down, and then she took me to her friend, a lender. He looked at my assets (I owned nothing except a 25 year old car--I had just left grad school) and said that I could buy a house in a range that left me breathless. I mentioned that I was not a US citizen nor a resident alien (I was in the US on a legal working permit), and they told me that in the US anyone can buy a house. I mentioned that I was single and that I had no guarantees that the job that brought me to the area would last, and they assured me that I could sell in a year if needed. In tandem with the lender, the agent took me to houses that were palatial (in my opinion)--they were gorgeous homes with numbers of bedrooms that a single woman with two cats would have no need for. When I mentioned that I did not feel comfortable buying a home that would lock in 60-70% of my monthly income, they offered ARMs and 40, even 50, year mortgages.
Are you not an adult? Making a purchase that takes 70 percent of your income when you have not, over the years, managed to save even 5 percent of that amount? While living in a foreign country? With little job security? Fresh out of grad school?
I'm no fan of the Fed's program of in effect devaluing the dollar to bail out irresponsible lenders, but this handily demonstrates the fact that for every irresponsible lender there is an equally irresponsible borrower.
