Saturday, Aug 09, 2008
You know where the door is
Times: Credit crunch and the mortgage market: a vicious circle
“This time last year, competition was rife with loss-leading deals. Banks thought their money was safe because of property price inflation. Now, greater margins have been allocated to cover the increased probability of defaults....“We are not expecting that better mortgage availability will be enough to resume pre-crunch activity levels, but time is a great healer.”
Posted by pendulum @ 09:01 AM (761 views) Add Comment
8 Comments
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1. pendulum said...
Why is this still portayed as bad news - when the collective madness was the root cause? So I can't get a 125% mortgage with no deposit as a self-employed organ-grinder with no bank statements.... what have things come to. There is money out there if you can prove you can pay it back, and cover any risk with a reasonable deposit - just as it should be.
It'll likely get more strict - mortgage securities are worthless, and there is little money to be made from our savings, as we're collectively skint. Unless the govt back mortgage bonds, it's game over. If they do it'll just pan out the problem, not to mention huge risk. If Darling had any balls he'd just say we need to ride out the problem, instead of financing short-term fixes and saving up bigger problems. Problem is, he probably doesn't (have).
2. Eternal Sceptic said...
A vicious circle derived from a magic roundabout. Obviously Zeberdee was not the only muppet.
3. it_is_going_with_a_bang said...
The focus should be on the fact the the market changed so much and badly as to allow this to happen in the first place.
The question should not be why are there no 125% mortgages. It should be why on earth were they ever allowed?
It is totally irresponsible lending. The fact that 100% + mortgages cannot be found should be celebrated - not questioned.
4. it_is_going_with_a_bang said...
Time is a great healer - yes about 5 to 10 years should do it.
5. Braindeed said...
Polyannas can put a good spin on anything - but when the last one lays down, hopefully prices will revert to value sooner rather than later ....and we can all get on with actually living
6. alan said...
"but time is a great healer" ... there there luvvies, it's all going to get better soon - NOT!
Folks, you can't lose tens of billions of pounds and then go on merrily lending! Losses on mortgage defaults hasn't even started yet in the UK! The USA is about 9 months ahead of us and their mortgage companies are still coming undone.
7. paul said...
This is utter denial.
As a recent FTB, Rebecca O'Connor must be bricking it.
8. wally said...
Is she suggesting that easy credit is a good thing? Rebecca, if you are reading this then please lend me a million, and to make it easy for me I'll repay over 40 years at 1%. I self certify that you don't need to worry about getting your money back.