A second, far larger wave of U.S. mortgage defaults is building

Discussion in 'Economics' started by bl33p, Aug 4, 2008.

  1. bl33p

    bl33p

    I really don't like the tone of this:

    http://www.iht.com/articles/2008/08/03/business/mortgage.php

    "NEW YORK: The first wave of Americans to default on their home mortgages appears to be cresting, but a second, far larger one is building with alarming speed.

    After two years of upward spiraling defaults, the problems with mortgages made to people with weak, or subprime, credit are showing the first, tentative signs of leveling off.

    But with the U.S. economy struggling, homeowners with better credit are now falling behind on their payments in growing numbers. The percentage of mortgages in arrears in the category of loans one rung above subprime, so-called alternative-A, or alt-A, mortgages, quadrupled to 12 percent in April from a year earlier. Delinquencies among prime loans, which account for most of the $12 trillion market, doubled to 2.7 percent in that time.

    While it is difficult to draw precise parallels among various segments of the mortgage market, the arc of the crisis in subprime loans suggests that the problems in the broader market may not peak for another year or two, analysts said." ... [continued in the article]

    Goodbye consumer confidence. Goodbye earnings. Welcome sub-1000 S&P500.
     
  2. vv111y

    vv111y

    Well, this was posted up at Ritholtz's blog last october:
    Things finally settle down in 2nd half 2012

    [​IMG]
     
  3. G-Boa

    G-Boa

    what price-range of homes did the option adjustable rate mortgages mostly finance??
     
  4. vv111y

    vv111y

    If you were asking me, sorry I couldn't find the info. I checked the IMF report that came from - didn't have it.