Report Reveals Surprises About Sub Prime Borrowers

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This entry was posted on Tuesday, April 17th, 2007 at 3:09 pm     and is filed under Interest-Only, Mortgage Programs, Mortgage Rates, Subprime Meltdown. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

4 Responses to “Mortgage Giants To Rescue Distressed Borrowers”

Mike Says:
April 17th, 2007 at 3:18 pm
The greed from everyone jumping into the housing boom over the last 5 years created artificially inflated house prices. Investors account for nearly 26-30%(maybe more if we knew the real story) of the purchasing of these subprime mortgages trying to ‘get rich quick’. The rest of the mortgages were purchased by just about everyone with the same mindset of, “I got to get in while the getting is good”.

A correction in the housing market is absolutely necessary. Home prices are beyond the affordability of the average paycheck and it’s destroying our quality of life. In some areas like San Diego, affordability runs at 8-12% of the population can afford a ‘MEDIAN’ priced home.

Investment is a risk. The problem became that there were so many wan-a-be millionaires, like your neighbor who took out an equity loan on his house to buy another, that drove the market higher and higher. I am sure they would be laughing all the way to the bank if they made the right decision. However, it was their ‘choice’. Their risk and it’s their responsibility to bear the pain of their mistakes.

Let the market fall back to a reasonable level of affordability, period.

Marc Says:
April 17th, 2007 at 7:30 pm
Mike,

I agree with you that greed took hold. Even first time buyers had dollar signs in their eyes in the last few years. Every one had developed a short-term mentality. Flippers replaced day traders in the latest get rich quick gold rush.

When will people learn?