If It Sounds Too Good To Be True...

C'mon! Say it with me! "...It probably is!"

Any parent worth his/her salt presses this into the mind of the kid, right? It sure was taught to me! And to most everyone I know!

Yet, even knowing it doesn't mean people actually heed this warning. Yes, there are fast talking salesmen who confuse the subject so the buyer doesn't really know what he/she is getting. And that's okay if we're talking some cheap item-after all, even fast talkin' salesmen have the right to make a living.

I just finished watching a PBS documentary on how America got into the sub-prime mortgage snafu. I heard lots of bad stuff about the former CEO of Ameriquest, how the government isn't willing to help, how manipulative the mortgage salesmen were-but never, not once did someone say, "If it sounds too good to be true, it probably is."

There was lots of finger pointing at everyone EXCEPT the person who was the final decision maker: the home buyer. Trust me, I'm as distressed over the home mortgage problem as anyone(except those who've lost their homes), but I can't keep from thinking: the person who bought the home made the decision. It's that person's name on the forms. It's that person who ultimately has the opprotunity to turn down everything because it's just not a good deal. And most importantly, that person has the responsibility for educating him/herself on every aspect to do with the mortgage.

Really, if prime is 6%, and a slick mortgage salesman offers a buyer a rate of 2.5%...uh, maybe we should think back to the days when Mommy and Daddy said, "If it's too good to be true, it probably is..."

Really, ARMs tell you, right there in the name, that the rate is "adjustable." So, when the low rate was named, what kind of fool doesn't ask, "So, what will the rate be when it's adjusted?" Apparently, 2 million homes(estimated) in the U.S. were bought by just such fools.

II loathe the mortgage companies who used illegal and immoral tactics to make sales. But let's not forget personal responsibility. If someone is about to make the biggest investment in life, I hope they're smart enough to read the fine print-and to remember the lesson our parents taught.