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Source link: http://archive.mises.org/18369/whats-wrong-with-this-picture/

What’s wrong with this picture

September 8, 2011 by

Super risky real estate market out there, with prices still falling, bad debt held at non-market prices as assets by zombie banks, government owns 1/3 of foreclosed upon properties, the two biggest government-backed lenders effectively bankrupt, an impending second dip of the recession, and: Mortgage Rates Plumb New Lows.


billwald September 8, 2011 at 12:40 pm

The Fed is bidding down the interest rate? Maybe playing the stock market?

Walt D. September 8, 2011 at 1:42 pm

… and housing sales and mortgage originations at ( a 20 year ?) low.
Suppose Warren Buffett applied for a $200,000 20% down mortgage on a town house. Would he qualify and how long would it take?
30 minutes, subject to appraisal?
Try 6-8 weeks assuming that he qualifies.
What could stop him from qualifying? No credit history – Warren Buffett is probably debt free and since the credit score does not use income, assets, age,race, sex or employment history, Warren Buffett would look like a recent high school graduate. (This is why Credit Card Companies issue cards on college campuses, using requiring the parents to co-sign).
I’m not even sure that if he bought the bank after being turned down that he could make himself a loan without violating the Fair Credit Act!

nate-m September 8, 2011 at 6:12 pm

People don’t understand that credit score does not have anything to do with whether or not you are trustworthy, but with how profitable you are to the lender. That is why a millionaire who does not borrow except when he can pay it immediately off will have a bad score, but a Guy that continually maxes out his credit cards and spends his paychecks on debt payments will have fantastic credit score.

J. Murray September 9, 2011 at 3:36 pm

That’s interesting considering I’ve never once paid a single interest payment in my entire life yet have a phenomenal credit score.

FDominicus September 8, 2011 at 11:40 pm

Well there’s nothing wrong from the view of the deledefs but well everything viewed through the eyes of anyone having to work for customers to earn their living.

And you know we just have to have more money (aka debt) and everything will be fine…. For sure…

kenny September 9, 2011 at 7:53 am

My brother in law is writing Veterans Administration loans. He is refinancing as many as possible. He only works with Veterans now, he was formerly at Capital One. The protections and extra guarantees that some government positions allow are one of the only areas left for home financing. I recently looked at refinancing my own mortgage. The Private Mortgage Insurance has now risen 300% since mid 2006.

FDominicus September 10, 2011 at 1:43 am

So still the same old problem. More credit and cheaper credit instead of more saving and more sound financing, That’s worrying.

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