The Fed’s drastic reduction in interest rates following the Dot-Com stock market bust is…
An economist at the Bank of International Settlements looked at 60 countries and found the most common housing policy changes over the last few decades.
#1. Minimum Down Payment Percentage
In the olden days, when savings and loans (and banks) made and held mortgages on their own books, they bore the entire cost when bad loans defaulted. There was a direct link between the loans they made and their profits.
Subprime is the top villain in most explanations of the Great Real Estate Bubble but not all subprime mortgages were created equal.
On one extreme, you have borrowers with;
Early in the Great Depression (before Roosevelt?), a new federal banking charter was created for savings and loans. Savings in federally chartered S&Ls were insured so people felt safer leaving money in S&Ls and S&Ls in turn would then have money they could lend to…
“Fannie Mae and Freddie Mac were statutorily required to hold mortgages with at least 20% down payment. The way the GSEs [Fannie and Freddie] got around this…
The ratings agencies (Moody’s, Standard & Poor’s and Fitch) had a terrible track record even before the Great Real Estate Bubble and the Great Recession.
The mortgage system that replaced Savings and Loans was;
I’ve been trying to figure out what the hell happened during the Great Real Estate Boom and Bust.
I’m shocked that 11 years after home sales peaked and 7 years after the “end” of the Great Recession there isn’t a conventional…
