Posted on 06/21/2016 11:50:02 AM PDT by Sgt_Schultze
The New York Fed just warned about the ticking mortgage subprime time bombs once again being amassed, and what happens to them when home prices decline. But unlike during the last housing bust, a large portion of these time bombs are now guaranteed by the government.
- snip -
Before the housing bust began in earnest in 2007, the median LTV for these subprime mortgages was around 98% and the median credit score was below 650. In the years since the government has taken over insuring these loans, more than 10% of government-insured loans had LTVs of over 101% and “one-quarter were made to borrowers with FICO scores in the low 600s and below.”
(Excerpt) Read more at wolfstreet.com ...
What could go wrong? /sarcasm of course
Our fiat, unbacked currency, and a Federal Reserve that can create money and debt at will, and manipulate interest rates - are the blood, oxygen and steroids for the growth of the political, corrupt, insider progressive nanny state.
this will destroy the USA.
Because everyone deserves to own a home, even those who can’t afford them.
Despite past lessons, considering who typically gets subprime loans, how many are ARMs? Might explain the Fed’s inaction on rates.
Everybody has a right to chose where they live. I read that in a HUD pamphlet.
And I know a lot of idiots that believed that, like the only reason the internet bubble popped was because a republican was elected president.
Shrinking (shrunken) job market, anti-job policies, lies and damned lies about unemployment - all part and parcel of the most transparent (ha) and most lying administration in American history - Barack Hussein Obama.
You can bet it’s going to crash. If they can keep the lies going until the next person gets in. I’m surprised their lies have so many fooled. It will be a very rude awakening to most Americans when this beast pops up again. 2008/2009 will seem somewhat mild by comparison.
Yes. And those of us who remember what the Fed did during the 1970’s have not forgotten, either.
this will destroy the USA.
Fait accompli my friend.
this is one of the most profitable large-scale theft rackets ever invented...and it will continue to occur, over and over again...because it is so profitable..
1. certain politicians buy votes this way, while getting huge payoff bribes
2. banks make money doing the loans (and now assume zero risk since the government takes on all the risk of these imprudent loans....... separating risk from reward is a time-honored prescription for economic disaster.....)
3. ultimately, the working people of America pay all of the above (political bribes, bank loan processing fee profits, and the defaulted mortgages themselves).
4. wait a couple years from the last crash (payoff day) and REPEAT above sequence....
this will continue until we clean up the system and clean out the crooked politicians who are getting rich off it
Guaranteed by the government??
More like guaranteed by the tax payer.
Seems liks a Yogi Berra quote is needed here.
Buyers are paying 50 to 60 cents on the dollar for mortgage notes right now, even for well-seasoned notes. That’s absurd. They can all go stuff it up their bungholes.
Well, we are about to put our house on the market, and I hope it sells before all this hits the fan.
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