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First of all, I have no idea where the notion that the credit crisis and housing market bomb that has hit our nation has anything to do with the poor? The crisis has everything to do with the"greed" of those that are far from poor. I know, I know, you've heard it said before, and this drum was beaten over and over throughout the Presidential Election by both candidates, but even so through all the rhetoric, it is true. I witnessed the rise and fall of banks and mortgage companies alike, and it is no secret that as soon as the housing market went up and property values soared to over 30% here in northern California, new mortgage companies and lending institutions popped up like Starbucks on every street corner wanting a piece of the action, and it wasn't coffee they were smelling!

Interest rates were low, so those who could qualify through standard means to buy a home did. But, once the well of qualified buyers dried up, lenders needed to find a way to attract more buyers, and get people to use the equity in their homes, so they developed more and more lending programs and guidelines that would allow the less conventional buyer to qualify for a home loan. People buying homes were not limited to first time buyers, or those refinancing their own homes, but extended to buyers who were buying properties for investments and for second home vacation rentals. Beyond that, it extended to buyers who had no verifiable income or employment, because Alas!, it was not necessary. No Income, No Verification, No Assets....and the list goes on. Sadly, more and more people didn't see themselves as making a long term investment in their home purchase and chose adjustable rate programs with low start rates, or negative amortization loans, etc. just to qualify to get into the property so they could turn around and sell it to the highest bidder. And why shouldn't they too benefit from the gravy train? But, it is common knowledge that it takes money to make money, but in these cases, just not as much money (due to the less restrictive lending policies). How then can this be in any way blamed on the poor? They have no money to invest.

In 2007, we saw the beginning of the declining housing market when homes began to go into foreclosure, statistically, it was the lower end homes that first went back to the banks. For all intensive purposes, let's just say these were the "poor" - but still were people with an median income of $20-$25K a year. These homes ranged in value (here in northern California) of $80k to $150k. Within a year, homes that ranged in cost of $450K plus started to go into foreclosure. People who owned these homes were making monthly payments on their mortgages of approximately $3,000K plus. These are hardly the "poor" people who were buying these homes. It is true however, that once owners got into these high priced homes and continued to make mortgage payments on 100% financing, that they probably felt poor. But, I don't think that is the same thing here.

The credit crisis is not an economically selective virus, it is opportunistic, as are we. In the land of plenty, we all saw an opportunity to have more for less. Why not? Credit became an opportunity to have now rather than later, with the intent to pay it back. Unfortunately, along the way we forgot how to stop spending more before we paid it back and it's a vicious cycle. It's about getting back to basics, and learning how to save and live within your means. The inevitable has happened, and what went up eventually had to come down. Perhaps now it can be a time of reflection, and an appreciation of the poor who only know how to live within their means.

Learn more about this author, Marie Hall.
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