Apparently the mortgage crisis is leading to a “mental health crisis.” Read the story here. Here is my favorite section:

“They’re depressed, anxious. It’s affected marriages, relationships,” says Richard Chaifetz, CEO of ComPsych, a Chicago-based employee-assistance firm that is counseling homeowners over mortgage fears. “People tend to catastrophize, and that leads to depression. Suicide rates go up. We see an increase in drinking, outbursts at work, violence toward kids. Before, their houses were like ATMs,” as they rose in value. “Now, they feel trapped like a rat in a corner.”

Look, I feel for people who are struggling financially, I’ve been there and in some respects I still am (over 100 grand in student loans will do that to you). However, at risk of sounding like a mean old conservative, I am having a hard time feeling too sorry for these people. People who have their houses foreclosed on have no one but themselves to blame. If you sign an ARM, they are very clear (they have to be by law) that at the end of the ARM period, your rate can go up or down depending on the prime rate. This means when your 3 or 5 year ARM is up, it is likely that your payments are going to go up as well. Is there something wrong with taking some personal responsibility and owning up to your debt? Even if things get so bad that you can’t afford your mortgage payment there are many options. Move out of the house, get an apartment that you can afford and start working off that debt that you will owe. Bankruptcy is another option. The bottom line is that the mortgage crisis is no one’s fault except for the person who purchased the house that they could not have afforded in the first place. If you get an interest only loan and the market bottoms out, guess what, your screwed. That is the risk you take when you make a $500 monthly payment on a $300,000 house. The lack of personal responsibility in this country is remarkable.

The other insidious aspect of this story is the way the media creates something out of nothing. We all know that foreclosures are up, but 96% of us are still making our mortgage payments. We were the people who didn’t buy a house that we couldn’t afford and hopefully bought it with a fixed interest rate. However, the media uses this kind of crap to scare everyone into thinking we are in a huge crisis, so huge that they have to set up crisis hotlines to prevent people from killing themselves over their house. This is not a crisis, it is a market correction that I predicted would happen about 5 years ago. When you have house prices going up 25% per quarter in some parts of the country (Summerlin, NV was like that) you have to know that the market can not possibly sustain that kind of off the charts growth. The bubble has to burst. This “crisis” is just another fabrication created by the media.