A plurality of Americans say the government shouldn't provide financial assistance to borrowers who can't afford their mortgages, a new poll shows. But 41% agree strongly that mortgage brokers should be better regulated.
According to the Wall Street Journal Online/Harris Interactive poll, conducted Dec. 10-12, a quarter of respondents agree that the government should provide financial help for mortgage holders, while 20% disagree and another 22% strongly disagree.
The survey of 2,082 U.S. adults, of whom 1,331 are homeowners, shows a strong consensus that mortgage brokers should be better regulated to make sure borrowers obtain only those mortgages they can afford; 41% strongly agree, 23% somewhat agree and only 7% disagree.
When asked who's most responsible for the trouble in the housing market and mortgage business, half blamed mortgage lenders and brokers, while 21% said government regulators are responsible and 16% said home buyers are to blame.
Nearly half of those surveyed also say direct lenders are most responsible for making sure borrowers are able to pay their mortgages and that they should be required to modify loan terms for mortgage holders who can't afford their current terms. By comparison, 15% disagree and 24% said they neither agree nor disagree.
Several policy moves are under way to help struggling homeowners, including a plan to freeze interest rates for some subprime mortgage borrowers and the Federal Reserve's move to offer banks special funding at lower-than-usual rates so they can lend more.
However, Americans are divided on whether direct lenders are responsible for borrowers who "invested recklessly or bought more house than they could afford," with 34% agreeing, 35% disagreeing and 21% saying they neither agree nor disagree.
Twenty-two percent of those polled say a freeze on rates for adjustable mortgages will unfairly penalize mortgage investors, compared with 31% who feel it won't. Thirty-seven percent believe a rate freeze will unfairly reward borrowers who made bad financial decisions, compared with 21% who disagree.
Despite reports of a wave in home foreclosures, only 2% of respondents with a mortgage said they have missed several mortgage payments or have been in the foreclosure process.
In fact, few of those surveyed expect the current mortgage crisis will have an impact on the sale or financing of their home: 7% said they expect to have difficulty obtaining a mortgage or refinancing a mortgage and 14% plan to delay the sale or purchase of a home, while 2% plan to lower the asking price of the home they are selling.
Likewise, the poll shows steadfast optimism in the face of widespread concerns about a housing slowdown. Nearly half (48%) of homeowners say the value of their home at least moderately increased in 2007 and 41% are optimistic that its value will increase over the coming year, despite the recent slowdown in the U.S. housing market. Only 15% of homeowners responding to the poll believe their home's value will decrease in the coming year, including 1% who think it will decrease significantly.
When asked if their most recent mortgage is "subprime," 58% said it isn't, 10% said "yes," and nearly a third of mortgage holders said they don't know if their current mortgage is considered to be subprime. Among those with household income less than $35k, 47% are unsure whether their mortgage is subprime, compared with 21% of those with income $75k or higher.
About half (47%) of respondents who have a mortgage on their home say they obtained it through a direct lender, while nearly a third obtained their mortgage from a mortgage broker. Homeowners with higher incomes are more likely to say they obtained their last mortgage through a direct lender and those with household income less than $35K are more likely to have used a mortgage broker.
Eight percent of mortgage holders say they chose their particular mortgage because of "speed or less paperwork," while another 8% cited easier qualification. Only 6% said "it was the only loan they qualified for, and 2% said they didn't mean to choose that particular mortgage.
Only 7% of mortgage holders believe they were misinformed or otherwise misled by their mortgage broker or loan officer about the terms of their loan, compared with 85% who feel they weren't misled or misinformed. Among younger mortgage holders ages 18 to 34, 13% believe they were misinformed and 17% say they aren't sure.
Source: RealEstateJournal.com
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