Wonderful. And why, were banks so eager to make loans to people with no (or falsified) ID? Could it be Government pressure to keep that cheap labor flowing? Turns out that cheap labor is awfully expensive, isn’t it. Of course, some of us “xenophobes” have been saying this for a while. Now the chickens have come home to roost. I’m just surprised is starting to be reported truthfully.
Can’t feeling some genuine anger. Two years ago our governor was announcing aspecial fund to assist illegal aliens to buy a home. Now my son wants a mortgage and the market is pretty thin.
What percent of the bubble was unanticipated and ultimately unreal demand? Our political elites? I spit.
To make money.
There was a method to their apparent madness. See Post 49.
These idiotic loans were not only made to illegals buying $100,000 houses for $200,000. They were also made to people with good jobs that were buying $400,000 houses for $800,000.
Now that the "Interest Only" grace periods have expired, illegal aliens with low paying jobs cannot afford both interest and principal on a $200,000 mortgage and people with good jobs cannot afford both interest and principal on an $800,000 mortgage.
But, "Don't worry", they used to say. "Once the grace period expires, you can simply refinance or you can sell that $800,000 house for $1,000,000 and make a $200,000 profit."
Result: Foreclosures for everybody that relied on a gimmick loan to pay an asking price that was far more than they could afford to repay.
Remember the "Is There Really a Housing Bubble?" threads on FR only about a year or so ago?
Remeber how most FReepers laughed at those like ex-Texan who warned about what was happening?