2 ms·
2008 was caused by leverage on top of poor quality mortgages. Afaik, that's substantially reined in now. A lot of people would still be underwater on their mor
by ethbr0 5y ago
2008 was caused by leverage on top of poor quality mortgages. Afaik, that's substantially reined in now.
A lot of people would still be underwater on their mortgages, but a smaller number would default (if central bank rates spiked, it would only impact adjustable rates), and the the spillover onto banks would be substantially less.
Which is how it should be: housing corrections should suck for homeowners, but not topple well-capitalized banks.
- hellbannedguy 5y agoIt's gone too far though. It's to hard to get a loan. Of course the wealthy, including foreign aliens, have no problem collecting homes. The only thing Bush ever said I liked was "Everone should have a shot at buying a house.", or something like that.
- MeinBlutIstBlau 5y ago> 2008 was caused by leverage on top of poor quality mortgages. Afaik, that's substantially reined in now. So instead of having mortgages over 100% loan-to-value, the appraised value is just inflated beyond the actual value so that you keep the loan-to-value ration below 100%. It's the exact same concept, they just shift the numbers around so the government is happy.