Psychological Effects on Subprime Mortgage Crisis Essay

The day of owning a home was a wonderful experience that Janet Wilson disc totally overed later on closing on her first home. Shes a single mother with two sons and when her loan policeman explained that her mortgage loan would be approve and she felt her dream of homeownership will be reality. The closing be were at a minimum due to the loan officer explained it would be an easy closing with utter out of pocket costs. Janet worked for a healthcare organization for several years and was able to save sufficient money to buy needed furniture for her home.Janet enjoyed her new home and finally felt the independence and effect in her life. At 45 years old, she waited a long time witnessing others in her family and friends reaching that object of homeownership. Janet desperately wanted to reach that goal as well as experience the feeling of obtaining the American dream. In trine years of homeownership she was able to pay her mortgage with no problem and was able to part to re-dec orate her home. Her boys loved the neighborhood and had developed close friends their age.Ms.Wilson forgot all her about her closing until one day she legitimate in the mail a letter from her mortgage company that her interest rate is being increased. Janet saw her new adjusted mortgage recompense and she almost fainted with disbelief. She was extremely concern of why she wasnt assured of this possibility from her loan officer at the initial closing. Janet called the mortgage company and they showed no compassion that make the ordeal even more nerve-wracking. Janet did non know what to do and the fear of losing her dream home and not having a roof over her sons head made the situation completely worse. subsequently a couple of months passed with the increased mortgage payment in effect, Janet was unable to make the mortgage payment so then a barrage of letters was received about a pending intend foreclosure. Janet could not work, sleep, or eat due to the enormous stress about the horrible thought of having no place to live and becoming homeless. The thought of losing her home and turning her life upside down with the machinelike backlash on her credit score brought psychological effects to her mentality.She knew it would be harder to get another dwelling to live with bad credit score and with her circumscribed amount of income. According to Steve Bergers article Legislators presiding over the subprime crisis hearings should look in the mirror and pose a few hard questions before assigning all blame to predatory lenders and mortgage brokers (Berger, 2007). Ms. Wilson experience was the fundamentals of many other in the mortgage meltdown. With limited regulations in place when Ms. Wilson took out the mortgage loan, the predatory lenders gain an opportunity to make money on the backs of someone else dream.There a great deal of pundits stating that many are to blame and that nearly three out of all four subprime mortgages originated by brokers were eith er fraudulent or misleading tactics apply to trick borrowers and lenders (Bitner, 2008). In the meantime, Janet Wilson is facing foreclosure and in a difficult position to choosing what to do in her stressful crisis. She is torn between trying to save her home with a tight budget or to toss away due to the limited availability to avoid paying the increased mortgage payment.Janet is listening to every news update on the government attempt to assist homeowners in the mortgage crisis as the investors were assisted. In addition, to the rise of foreclosures across the country similar to the situations like Janet Wilson, the financial industry must and will agitate in order to bring the United States economy back on track (Lee, 2003). In the meantime, the homeowner is stuck not knowing what tomorrow will bring or if their home will be interpreted away due to misleading practices.