Does anyone have any interesting facts or statistics about the subprime loan fiasco going on?

Question

I would like to know some of the interesting details that effect the market. Thanks folks!

Answer 1

Ask anyone with a statistical degree and they will give you a pretty interesting story. I was lucky enough to hear part of it today. It seems that this isn't the economy at all. IT is the loans that were written in 2003/2004 that hit the adjusting time frame so that they are higher now and the people who committed to paying them may not have received the raises or whatever they had planned on happening didn't happen so we may see even more hit in the next year than have happened so far but, it is old news. Not new news! The mortgage industry could have predicted this would have happened and perhaps there was a bit of greed involved. I do know that the industry is scrambling to find away to help the people who are looking to buy today. We had a suggestion from our favorite lender today that said simply-look at the FHA products-they aren't as big a pain as they used to be. He also cautioned us to not expect 100% ffinancing for people who are in the 500's for their credit scores-not out there anymore. Hope this helps a bit. Good luck if you are moving. I can refer you if you have a need for it.

Answer 2

The answer is more complicated than what I will give you here however in a nut shell , we allowed the banks to get creative and find more ways to grant loans to people who were not or marginaly qualified. On top of that many of the loans were based on short terms such as 2,3,5,and 7 years after such a time they would "adjust" . Now most of the country and especially here in the S.W. are finding our home values dropping for the last 3 years instead of going up. So where does that leave the homeowner, with a loan that he can no longer afford, on a house that is worth less than they paid for it. Remember during the first 15 years of a 30 year fixed loan you pay very little toward the actuall price of the house. Most of the money goes to pay the interest.
Since the end of 2006 ,and as of today we've lost 115 lenders
Want to know more ? let me know what you want to know , are you wanting to buy a house ? 100% loans are still available , you just need to have some things in place

Answer 3

AIG, the 2nd largest insurance company, had market moving things to say today. see link below

BNP Paribas [largest French bank] also had things to say
http://money.cnn.com/2007/08/09/news/international/bnp_subprime.reut/index.htm?postversion=2007080910