Article February 25, 2008 Issue

LET GREED RECEDE

BY WARREN BOLON

A once-overheated but now declining US housing market, abetted by questionable lending practices, along with aggressive investing by domestic and overseas financial institutions in mortgage-backed securities, have pushed the US economy toward recession and triggered declines in other nations' stock markets. I spoke with mortgage industry expert, David Olson, president of Wholesale Access Mortgage Research and Consulting, based in Columbia, Maryland.

"THE MORTGAGE MARKET is going through a chemicalization due to a period of bad practices that could not stand for long," says David Olson. He is referring to ill-advised practices in both mortgage lending and house buying in the US. He believes that everyone—prospective home buyers and sellers, lenders, and investors—can make a meaningful difference toward calming turbulent economic waters by changing the way they think and act in the marketplace.

If an economic correction is needed (and Olson believes one is already underway), then the deeper correction needed is a moral one, according to Olson. He notes: "We will reach a state of harmony in the mortgage market when we are obedient to the injunction of 'love your neighbor as yourself'—and this demand includes the customer, the employee, and the investor. It is not about maximizing profit in the short term. We have to be willing not to follow the crowd but do what is right and follow God."

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