Our mortgage and the mortgage crisis

We're in the process of buying a house, and we're reviewing very long documents that are required for the purchase. There are documents for title insurance, house insurance, closing costs, house inspection, house appraisal, loan documents, and so on, for ever, it seems.

I do my best to read them over and understand them but they're overwhelming. I can't say I understand everything in them, but I trust our loan officer and realtor to make sure everything is satisfactory.

It makes me think about the housing and banking crisis that the nation is experiencing. We've suddenly discovered that our houses aren't worth what we thought they were, and we've learned that real estate prices have been grossly inflated. People signed papers that were worthless.

What is a mortgage, anyway? It's a piece of paper in which you agree to pay a certain amount to the bank every month, in exchange for them paying the purchase price to the seller.

The only trouble is, the bank's money used to pay the seller is often imaginary money, which is another way of saying that it's leveraged money, money that is used many times over. It's valuable as long as the bank is solvent and all its assets are solid. But if the bank makes many loans that go bad, then all of a sudden the bank's money is gone. Poof.

Does anyone actually own anything anymore? Sometimes I think that everything is just being passed around from one financial institution to another and no one actually has outright ownership of anything. All our assets are just fiction.

But a house is still a house, right? And a brick is still a brick. True value never disappears.

A human being has infinite value and can never be sold or mortgaged. Relationships endure because they're built on solid values of love, fidelity and commitment. The soil waits, and the mountains shrug time off. Some things last forever.

"Lord, you have been our refuge from one generation to another." (Psalm 90:1)

No matter what happens to us in this economy, we can always count on the love of God.
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