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Good News About the Sub-prime Mortgage Crisis
loansandcheap.blogspot.com — Hey, wait a minute! In recent months, the national media has dwelled on the collapse of the subprime mortgage market and the surge of foreclosures. But there is another side to this story that should also be considered.
antosusanto- 86 diggs
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- yudhi0, on 10/14/2008, -1/+3i think it's contradiction guys with US problem.. isn't it
- antosusanto, on 10/14/2008, -0/+1Okay, i agree with u
- HellCrafters, on 10/14/2008, -0/+2umm... Wait one more year, then check that number again. To many people have ARM loans and there is not enough "real money" in the system for everyone to pay off there loans.
- bsingle, on 10/14/2008, -0/+1"If 8.4% are seriously delinquent or in foreclosure, 91.6% of the sub-prime borrowers are current with their loans and making their mortgage payments on time. They are enjoying the benefits of home ownership."
1) They are "home debtors" not "home owners." And I bet very few of them are enjoying the experience.
2) 8.4% seriously delinquent or in default does not mean that 91.6% are "current"... the majority are probably one to two months behind but not yet seriously delinquent.
3) It takes less than 5% to go bad to completely erase all earnings. In other words, all those subprime mortgages lost money for the lenders. And they increased the price of housing for people who really were in a position to buy a house with lots of money down.
4) There's a reason the rate of home ownership was at "only" 64% or whatever it has been historically: not everyone is suited to be a home owner. Not everyone has the sense of responsibility. Not everyone can put off buying stuff now to save money (100k+). Not everyone has had continuous employment for years.
5) My parents have purchased a number of properties over their lives and they always got 30-year, low fixed-interest loans with large down payments. I think maybe other people didn't have the advantage of having parents who knew what borrowing money to buy property involved, and these people weren't savvy enough about their own finances. But you don't have to be a math wizard to understand principal and interest and monthly payments, etc., so I really don't excuse their ignorance. - authorfriendly, on 10/14/2008, -0/+1time will tell
- melville248, on 10/14/2008, -0/+1The sub-prime market is being blamed for the whole financial break down and that's just not true. In Metro Detroit we have been feeling this depressed market for two years now. The decline of the auto companies and the domino effect it has had on our local economy has be devastating. The empty homes in my community are mainly from engineers loosing their jobs and having to leave the state for work and not being able to sell their homes and having to walk away from them. My point being, there is always more to the story people, not just the sub-prime market.
- GarrettGrimsley, on 10/14/2008, -0/+1So this is in the images section why?
- panicbombs, on 10/21/2008, -0/+1The artificial bubble that popped, along with easy money, and encouragement by the Bush government to be apart of the "ownership" society created the problem. The real issue was bundling these loans up as securities and dumping the bunk goods on the world market.
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