Real Estate Blog - What going on in the States with all those bad mortgages?

Home : Blogs : Mike Smith, REALTOR® : Nova Scotia Realtor

What going on in the States with all those bad mortgages?

Here is a video from CNBC on the current Mortgage situation in the States. Sounds like it is going to get worse before it gets better. Click on the Video below if you would like to see it. Thanks to CMHC insurance we should not have the same problem here.

Mike Smith, REALTOR® | 902.209.6745

Family First Realty | Halifax, Nova Scotia

iListinHD.com | mike@iListinHD.com

Posted by Mike Smith, REALTOR® on 09/10/2009 10:50 AM

Comments (3)

usa mortgages foreclosures

3 Comments on What going on in the States with all those bad mortgages?

SEP

I find that it varies market by market in NJ. Certain areas have many defaults and other areas are fine.

Mike,

Banks got way too greedy - making 100% loans to people who shouldn't have had mortgages to start with. Then, they started making loans to investors in amounts greater than the sales price based on the investor's claims that the house would be added on to or remodeled,etc.

All of these loans started going south when the economy hit a hitch and home values began to fall. We were due for an adjustment. How much can prices go up every year before there is an adjustment? I think we just got the answer to that!

That's it in a nutshell. Be aware and don't let it happen to your market.

Hi Lynda,

It should not happen in our Canadian market. CMHC (The Canada Mortgage and Housing Corporation) requires home buyers who can not afford to put down at least a 20% down payment to buy "insurance." The lenders pass that cost on to the home buyer. So we have a "reserve" to cover potential problems.

However the insurance costs up to 2.9%, or more in some cases, of the total purchase price which really make some potential buyers angry as it is not optional if they want a mortgage.

Thanks for writing,

Mike

This blog does not allow anonymous comments