[KarlInOhio]

"Banks are not going to want to be in the mortgage business after all this is over,"

Banks are not going to want to be in the mortgage business with 0% down negative amortization loans to people who can't provide paystubs on houses with fictional appraisals.

Maybe we'll get back to sanity with 10% or 20% down on mortgages with required principal payments.

[Alberta's Child]

A friend of mine had to come up with a larger down payment on a home a few years ago because the bank didn't accept the appraiser's estimate of its value. The bank was basing its estimate of the home's value on the value of the property according to its sister company -- the property & casualty insurance company that was underwriting the homeowners insurance policy.

This is exactly the kind of bank I love to do business with.

[ran20]

I think after all these companies like Capital One go down.. we’ll see a return of the big mega banks in the mortgage business. They got chased out from the absurdly low risk premiums, they could just not compete, and its a good thing they didn’t.

But when they get back in the game, stepping over the carcasses of all tehse failed guys.. it will be 10 or 20% down like you said.. and a big fat spread, especially at first. Plus actual verification of income, credit history etc.. So a 7% mortgage might become an 8.5-9.5% mortgage.