Who's The Victim?

It's been interesting to listen to the various politicos and economists talking about who's at fault for the "mortgage meltdown." Was it predatory lenders or naive buyers, bad lending rules or bad borrowing habits?

Either way, it's natural to assume that the now-foreclosed-upon borrowers somehow deserved a better fate. Even if they should have read their loan documents more carefully or considered the impact of an inevitable rate hike, there something about a hardworking family losing its home that tugs at the heart strings.

It turns out, however, that not every "victim" of the lending crunch was an "ordinary American homeowner" just trying to get by. According to the Chronicle, "More than one-fifth of 6,557 Bay Area properties that fell into foreclosure from January through September this year were owned by investors." House-flipping, as it's known, had become such a popular regional investment strategy that these small time real estate moguls now account for over 20% of our foreclosure "victims."

Read the whole article to see just how common this has become.

True, it's never a happy story when someone goes belly up, but it's a lot harder to believe that someone who owned eight investment properties didn't know the risk.