So, the poor DID benefit from economic growth last 10 years?

Question

Howdy. It's a truism to many people that the economic growth of the past 10 or 20 years just made the rich richer, and did not benefit the working class and the poor. BUT, now with this mortgage mess, we've learned that lots of poor and lower-income people were enabled to buy houses with mortgages that they would have been denied a decade or two ago.

Well a house of one's own is a nice little economic benefit isn't it? So is it resolved that the poor DID benefit, and in fact they made out like bandits and totally screwed the rest of us in the process?

Cassandra · Accepted Answer

What income was necessary to qualify for an inexpensive home? Minimum wage x 2? 

And how did they ultimately benefit if their mortgage is now upside down and they can't pay the note? Did they gain any wealth or did they encumber debt that they wouldn't have if they had not qualified?

? · Answer

I don't think you understand the current situation if you think poor people actually benefited from this chaos.

Do you realize that people were signing 30-40 year mortgages? 

So you are saying that the poor benefited because they were making payments on a home that they hoped to own which now belongs to the bank?  

Isn't it the bank who was hoping to benefit by having all of the previously made payments and then reselling the home to someone else.  You some one up high in management was thinking like this.

Jon D · Answer

well those poor people with adjustable rate mortgages lost their homes and credit score went down, so they are worst off because of the lower credit score.

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So, the poor DID benefit from economic growth last 10 years?

3 Answers