number5 wrote:
zer0netgain wrote:
It's a complex mess, but it started with a mandate to make loans to people so they could be homeowners regardless of their ability to repay.
Regardless of ability to pay? Are you sure? What is the basis for your quota theory? Source please.
Insofar as I have read the problems arose on the basis that the value of the purchased homes would almost automatically rise to make the purchase worthwhile and the conditions of repayment on the mortgage was agreed to be adjustable. When the banks readjusted the mortgage payments to be beyond the capacity of the purchasers to repay and the value of the houses ceased to rise to make the payments worthwhile the whole thing collapsed and the banks refused to readjust the payments to a level the purchasers could accomplish. The greed of the banks along with the unrealized hopes of the purchasers made the whole business a financial fiasco.
25 Sep 2009, 11:01 pm
