Posted on 09/26/2008 5:14:04 AM PDT by Renkluaf
Having no life, I've spent some time exploring the Federal Reserve web-site. In doing so I've come across some data that may be helpful for those inclined to contact their representatives with helpful suggestions regarding the "bailout" and what they can do with it. The Fed has provided Excel spreadsheets on the Nonprime Mortgage Conditions in the US which are packed with useful information about subprime and Alt-A (slightly better than subprime) mortages.
I was surprised to see that 57% of the subprimes and 81% of the Alt-A are current on their mortage payments. By itself that doesn't necessarily put them out of the woods because about 63% of the subprimes are ARMs and, of those, about 40% have yet to have a rate reset. On the Alt-A side, 53% are ARMs with about 56% not reset yet.
What's most interesting for me is that 55% of the subprimes were Cash-Out Refinances. What this means according to the site is that the loans were created as part of a refinancing and that the borrower took cash out of the property during the refinancing process. Keep that in mind when listen to Barney Frank or Cris Dodd bemoans the plight of those who are weighed down by these mortgages. It boils down to the Dims want you to caste a lifeline to some who elected to "spend" the equity that had accrued in their homes.
Somehow a significant number people seemed to believe that home equity loans were free money... A big, big mistake... I still can’t understand that mindset...
Thanks for posting this. Will use it in some future arguments.
More and more, I'm getting the feeling that the Bailout Boys are trying to stampede Congress and the taxpayers with their end-of-the-world scenarios. And yes, I recognize that subprimes are the least of the problem, but that 55% is an interesting point.
WOW, good work, the cash out refi was another anomaly that borders on stupid...why do we need to support this?
Aww fellas—give those pesks DIMORATS a break. They were just trying to fly the bailout by the legislature quickly so they could BUY a few votes. I mean, comeon fellas, the DIMORATS HAD GOOD INTENTIONS and after all, that has to count for something; he said with tounge in cheek.
Damn!!
Lost another one to Ditech!!
One friend who used to be in the foreclosure investment market said that invariably, foreclosures were filthy, and had big-screen TVs.
Stupid people will do stupid things, as long as irresponsible banks under the gun of racial political correctness let them.
Oh come on, didn’t you watch tv during the years between 2002 and 2006? “You’re sitting on valuable home equity that you could be using to ... consolidate and pay off high credit card debt! Or pay for your kid’s education! Or remodel! or just take a vacation. Take out a home equity loan and have one low monthly payment lower than your combined bills now - and use that cash for other things.”
Since the economy was driven by consumption, spending was also seen as patriotic.
There were probably Freepers who took these loans, because at the time they seemed like the smart thing to do. Especially because these were the Bush years and the economy was solid and improving most of the time.
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