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To: ANTIROCKEFELLER

I see. Makes sense from an economic POV, but you would then wonder who would accept a subprime instrument for (presumably) speculative/short-term gain.

100% LTV? What responsible, publically-traded institution would write such a thing?

In short, such a thing is plausible, but not as intuitively-tangible as you might believe. There are many competing sharks in the water. Lending is an easy buck for those with liquidity, and a few foreigners are dipping their toes into the US lending market, regardless of our monetarism. Still, I'll keep an open mind. Great article.


12 posted on 03/15/2007 11:55:21 PM PDT by IslandJeff (if you marginalize religion, only the marginalized will have religion. -Mark Steyn)
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To: IslandJeff

>>100% LTV? What responsible, publically-traded institution would write such a thing? <<

Heck, with a FICO of 640 you can borrow 125%. Throw in an adjustable rate or interest only and you get serious over exposure to housing fluctuations.

Or people with worse credit responding to ads like this

>>100% LTV HOME EQUITY LINE OF CREDIT
with NO INCOME VERIFICATION!

100% LTV (loan to value) line of credit with no income verification, no asset verification, no docs, no ratios, and no hassles.
Please Apply On-Line Right Now For Fast Approval!<<

You don't get a loan like that without a catch.

The borrowers should have understood they were taking a risk and the lenders certainly did.


29 posted on 03/17/2007 3:01:30 AM PDT by gondramB (It wasn't raining when Noah built the ark.)
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