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Thread: weekend commentary - 1 in 10 US mortgages now in default !

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    Default weekend commentary - 1 in 10 US mortgages now in default !

    (snip)"Dec. 5 (Bloomberg) -- One in 10 American homeowners fell behind on mortgage payments or were in foreclosure during the third quarter as the world’s largest economy shed jobs and real estate prices tumbled.

    The share of mortgages 30 days or more overdue rose to a seasonally adjusted 6.99 percent while loans already in foreclosure rose to 2.97 percent, both all-time highs in a survey that goes back 29 years, the Mortgage Bankers Association said in a report today. The gain in delinquencies was driven by an increase of loans with payments 90 days or more overdue.

    “Until we see a turnaround in the job situation, we’re not going to see these numbers improve,” said Jay Brinkmann, chief economist of the Washington-based bankers group, in an interview. “We’re seeing more loans build up in the 90-days bucket as lenders work to modify loans and states put in place programs that delay foreclosures.” (snip)


    in all probability, home mortgage payments aren't the only loans that these homeowners are 'behind' on i.e. auto loans, credit cards.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    Probably a statistic within your comment above; no link but someone posted that 5% of prime
    loans are now delinquent.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    ^^^ yes that was embedded in the 10% total mortgages in default.

    Prime borrowers going delinquent on mortgage payments is symptomatic of prime borrowers also going delinquent on auto loans, on credit cards etc. It is the relentless rise in the default rate of prime borrowers that has really caused the financial institutions to hesitate in making additional loans. A byproduct of course is the unilateral withdrawl / reduction of unused lines of credit to prime borrowers ... home equity lines of credit and credit card limits in particular.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    We are all going to pay for these people. Interest rates are going up and many credit cards have closed accounts. I've had a couple accounts closed because I had 0 on the account. I feel for those who bought houses, only to lose jobs. I don't feel sorry for those who bought houses they knew they couldn't afford.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    ^^^ yes and we ... with particular attention paid to independent contractor dancers with incomes that are difficult to verify, and with career lengths that fall far short of most mortgage terms ... are already paying the price in two ways. #1 we are being taxed to pay for the bailout losses. #2 we are being denied credit (or being offered subprime credit at exorbitant interest rates) as a result of the particular nature of our business.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    A cash only world is coming to be.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    Quote Originally Posted by The Snark View Post
    But then I suppose the sort of people who write this kind of crap generally don't allow their opinions to be tainted by things like "facts" and "reality".
    Distortion becomes somehow pure in its wildness
    The note that began all can also destroy

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    ^^^ yeah well that's the dirty little secret of all these bailouts ... the uber-rich bondholders don't want to be forced to take losses !

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    I didn't know all bondholders were rich. I thought anyone could invest, just have the necessary minimum to buy a bond.
    Quote Originally Posted by The Snark View Post
    But then I suppose the sort of people who write this kind of crap generally don't allow their opinions to be tainted by things like "facts" and "reality".
    Distortion becomes somehow pure in its wildness
    The note that began all can also destroy

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    ^^^ that is true ... but the typical minimum buy-in of $50,000 per bond puts 'front line' bonds beyond the reach of most 'average investors'.

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    That's why they invest through 'trusts' or other specialized instruments. Kinda like investing in a REIT. The more people, the less the per unit cost.
    Quote Originally Posted by The Snark View Post
    But then I suppose the sort of people who write this kind of crap generally don't allow their opinions to be tainted by things like "facts" and "reality".
    Distortion becomes somehow pure in its wildness
    The note that began all can also destroy

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    Default Re: weekend commentary - 1 in 10 US mortgages now in default !

    ^^^ granted that this is a possibility (state specific tax free muni bond funds for example), but if you go this route you sacrifice both several points of interest rate plus management fees.

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