Heh! In Canada we can trade usa markets without the PDT and no 25k required Your 'freedoms' continue to peeve me!!
...of course, then when somebody loses their life savings, they will complain loudly that "they should have had more protections" Isn't it all about credit risk? Im not totally against PDT or high leverage loans...but there has to be some protection for BOTH the the lender and the lendee.
07:27 Micro-lending industry could be beneficiary of subprime mortgage defaults Wachovia view the current credit weakness in subprime mortgage as a longer-term positive development for the micro-lending industry. As subprime mortgage defaults and delinquencies rise, this will likely have a significant negative impact on the overall credit scores and credit profiles of a portion of the population. Thus firm believes that future credit availability could be limited or more expensive, and therefore micro-lending services could better meet these customers' needs. Firm's best ideas for investing in the micro-lending sector are diversified lenders that derive revenue from more than one business line, such as FCFS, DLLR, and CSH.
http://www.latimes.com/business/la-fi-foreclose13feb13,0,791237,full.story?coll=la-home-headlines "The biggest problem, Bosch believes, was created by the lenders. They used to be cautious. They'd want the borrower's tax returns, pay stubs and bank statements, and it would all have to match up. The borrower would make three times his monthly payment. He'd have to scrape together a down payment. Sub-prime loans changed all this. Originally these high-interest loans for credit-challenged buyers were a small segment of the market. But as houses got more expensive, fewer buyers qualified under the traditional guidelines, so they went sub-prime. Lenders would take their word on income. They no longer needed down payments. They didn't worry that their loans would soon reset to higher interest payments. Nobody cared too much as long as prices went up, although many people in the business knew the day of reckoning wasn't canceled but merely postponed. "To make a living, you had to push a product you didn't believe in," said Aimee Quigley, a Home Center mortgage broker. "It was like being a defense attorney where you know your client did it, but you have to say he didn't." Quigley says she tried to emphasize how quickly these loans would adjust, causing payments to balloon, but the message rarely got through. "Nine out of ten times when these loans closed, we would sit there and say, 'How long can they hold it together?' " Now the initial wave of those who can't hold it together need to do something, but Quigley can't help them. Some sub-prime lenders have gone out of business; other banks have tightened their standards. Money isn't free anymore "
LOL My first home was such a hassle...I had to actually explain in writing why i was late with a Discovory card payment.....3 years earlier!!!!!! ( It was because I moved and Discovery wrote a letter on my behalf)...then they harassed me because my mortgage payment would be equal to 40% of my monthly salary...i had scramble to get it under 33% or they couldn't approve! and i had to have 15% equity down to boot..I think in the long run it was better that i saved and earned and got my shit together
Things about homes: When I bought my house my mortgage brokers said I had the highest credit score he'd ever seen. Interestingly enough - all the things I'd heard you needed to increase a credit score - loans being paid off etc. I had nothing, never leased a car or took one loan out in my life. Misinformation. I wonder several things about the housing market which I'm watching eagerly since I sold that house 7 months after buying it due to a relationship issue and then watched the Los Angeles real estate market soar to crazy new height for the next 3 years as my jaw was agape with amazement and dismay (house sold 3 years later for twice what I'd sold it for). So I WANT the market to crash... like many here it seems. However, I'm on the fence whether it will for the medium to high level homes. I think sadly the low income areas will once again be hit hard and those and near by areas will definitely feel more pain. But is there any reason to believe that this will affect mid to high range homes in neighboring cities? Is there any evidence of a trickle up effect? Something else.... I've lived in Los Angeles 20 years and I can say for sure... it's getting hotter. I think Global Warming is real and will get a lot worse in the the next ten to 20 years before it gets better. I'm wondering how that will affect housing values in hot locations (like San Diego and areas of Los Angeles). I wonder if people will be inclined to move northward. I wonder if in 20 years Alaska will be a prime real estate spot. Anyone have thoughts on any of this? I feel my personal desires are clouding my objectivity.
Hey, an honest bear! I like the "want it to crash" comment. In my neck of the woods, it is the upper end houses that are feeling the pinch. As it gets harder to buy a house because interest rates are rising, more folks settle for smaller houses. Also, at the same time, rents rise, which also tends to firm the small house market. I guess what I'm driving at is that the big fancy houses are the most volatile part of the housing market, IMHO. So if you believe that the correction is over, or nearly over, then you could act on your feelings by buying yourself a McMansion now. If you think its not over, then don't. Personally, I feel the bigger houses already took the brunt of it, and if you factor in the fact that rates are still pretty low, we're close to the time to pull the trigger. I'm house shopping for a bigger place myself. SM
Rents are not going up. The landlord tried raising rents this year and I laughed at him, told him he couldnt get that much for this place and that it was already over prices. I pulled out a list of 10 places that were nicer for less. He held his ground. So I gave 2 months notice. A week later he comes crawling back begging for me to stay at the SAME price, hahahahaha. I havent returned his call. Too many nicer places around now for less. There is record over supply here and lots of desperate "2nd home/condo" owners trying to rent their places out so they dont have to sell them.