To follow-up on last Friday’s posting here on Flipping Frenzy about President Bush’s public comments on homeownership financing…

The housing boom drew a lot of speculators and carpet baggers–freeloaders who wanted to make a quick buck during the gold rush and cared little or nothing about the long-term effects on the housing market. They took none of the risk, gathered all of the profits, and scampered out of town just before the sheriff showed up. They partied and left the American homeowner to pick up the tab.

President Bush said last Friday that a bailout is out of the question: “A federal bailout of lenders would only encourage a recurrence of the problem.” This is certainly true. Bailing out the lenders would simply lay the burden on taxpayers and provide the carpet baggers with another opportunity to pillage.

The President did reach out to some distressed homeowners–those with good credit histories who could probably pull themselves out of their current crises with a little help from the federal government. The FHA (Federal Housing Authority) will be given more flexibility to assist homeowners who have subprime mortgages. Homeowners may also be spared having to pay additional taxes in the event that the lender forgives a portion of their debt. Perhaps this will encourage lenders to work out reasonable solutions with homeowners.

But what about all the other consumers–what about hard-working American families who are too deep in debt to be saved? What about the children of these people who are going to be uprooted from their neighborhoods and the school districts where all their friends go?

Government officials, lenders, and people who have not been victimized by the shoddy lending practices of the last decade are quick to judge. After all, they are not the ones paying the price. The people who are suffering are the same people who usually suffer in these situations–consumers. These are the people who were sold ARMs (adjustable-rate mortgages) that ended up costing an arm and a leg. They were told that they could refinance before the rates went up or could build higher credit scores by making their payments on time and then refinance with a low interest rate mortgage later.

Then, the bottom dropped out of the housing market, making it nearly impossible for these hard-hit homeowners to refinance. Some of these loans even came with stiff prepayment penalties to further discourage people from refinancing. These folks were led down this path simply because they trusted an “expert” in a fancy suit with a silver tongue who failed to warn them of the looming trouble and the risk they were taking on. Where are these smooth talkers now? Probably out of work and seeking more fertile fields to ply their trade. They turned the American Dream of Homeownership into a nightmare, but they certainly aren’t the ones having to wake up to it.

Instead of letting them off the hook, they should be forced to take ownership of the problem they created. Instead of waiting around to see whether the federal government is going to bail them out, they should be actively pursuing the homeowners they led astray and offer them real solutions that can help these distressed homeowners regain their financial footing.

Everybody knows that discriminating against anyone based on race, color, national origin, religion, sex, familial status, or handicap (disability) is illegal and immoral, but discrimination continues. The passage of the Fair Housing Act in 1964 curbed some of the abuse, but it simply forced a few holdouts to be more careful and subtle.

If someone doesn’t want to sell their house to a particular person or family, or rent them an apartment, they can simply steer you clear of considering it by uttering a few remarks that, on their surface, may seem completely innocent, such as:

• “Your family might not feel comfortable living in this neighborhood.”
• “Too bad, we just rented out that apartment yesterday.”
• “We rent primarily to ‘professionals.’”
• “Houses in this neighborhood are a little pricey. You may want to look for homes in a more affordable area.”
• “There’s really no way to add wheelchair access to the building.”

If you suspect that you are or were a victim of housing discrimination, take action. What should you do? Here are some suggestions:

1. Realize that housing discrimination is illegal.
2. Write down everything you can remember about the incident, including the date, the names of the company and individuals you suspect of discrimination, and what was said.
3. Keep detailed records, including application forms and receipts.
4. Act quickly while the incident is still fresh in your mind.
5. Report the incident and your suspicions to authorities. The HUD (Housing and Urban Development) website has a Fair Housing and Equal Opportunity page at www.hud.gov/offices/fheo with an index of state and local organizations you can contact.

Keep in mind that laws have little effect on people’s behavior unless those laws are enforced, and enforcement begins with concerned citizens who take action. If you suspect discrimination, report it.