» Mortgage crisis overwhelming credit counselors. "We knew it was going to be bad, but we didn't think it would be this bad. [...] All the predatory lending that has gone on, all of the pushing of exotic loans on people of color, female-headed households, families with children, people with disabilities -- it's all coming home to roost." Kaye Britton, a foreclosure counselor.
rebecca's pocket
.: March 2007 --> Sub-Prime mortgages are starting to fold
Sub-Prime mortgages are starting to fold
[ 03.23.07 ]
So when's this gonna hit the Bay Area. I talked with someone pushing mortgages and "equity positions" last night who's trying to get some people to take partial stakes in Bay Area houses when the original owners can't keep up the full payments any more. Since the houses haven't been appreciating at stratospheric rates in the last year, there are a number of people who bought over their heads with nothing down, who are now out a couple of tens of thousands and looking at defaulting, and the sales pitch is that by taking half of these people's mortgages you get to assume a credit liability that's going to appreciate, and build your credit while you're at it.
Which, of course, means that Bay Area house prices are going to go even more artificially high (compare the price of rental with the price of purchase), until that house of cards starts toppling.
But I do now understand how all of thse middle-income families are "affording" million dollar homes if they're actually only buying half of the house.
Scary.
smoke and mirrors .... another name for the economy .... do you realize how everything would tank if people were actually content and happy for a few weeks, and didnt run out to buy something to fill the void? .... economy depends on discontent and emotional agitation, some of our finest products... and for every guy going down, someone is smiling at their good deal... this is not news at all, just the playing out of what people have been writing about for a couple of years... the housing bubble.... just a blip, on the way to a nice kerplunk, around about 2010, 2011.... enjoy
What I'm wondering is whether, when, and how the results of this predatory lending will come home to roost in a meaningful sense--here, read as "someone will take steps to end the practices that have resulted in this unfolding debacle."