Signs of Easier Money for Mortgages
Do you think the idea of piggyback loans is a good idea for banks to follow?
Considering what they said about home equity lines of credit and them being good short term credit options but can adjust substantially when rates go up. Could this potentially be a big problem if the banks start allowing any person to pursue lines of credit with home equity?
Another good point mentioned was despite the terms being reasonable now, what will we see happen as lenders start to become more competitive? Could we have a repeat of what happened despite the regulations put in place?
If banks start to ease up on loans I defiantly think that we could have a repeat of what happened during the housing bubble. People aren't able to pay-off their mortgages causing huge problems for mortgage back securities. To think that banks will ease up after all this happen just shows how regulations don't stand in the way of certain bank loans. It also shows that people just care about making money personally even if it negatively effects the entire economy.
ReplyDeleteMost people put their needs in front of others when it comes to money. If banks start to ease up there is no doubt in my mind that we could have a repeat. This economy is not stable enough to ease up now. People want to get the most out of everything they do. they will always try for more, thus they have the potential to lend more to people who do not deserve it.
ReplyDeleteI don't personally think that the piggyback loans is a good idea for the banks to follow. It is a very risky investment to make, with a reward that may not be worth the risk. Taking out two mortgages simultaneously can be a problem not only for the banks, but for the homeowners as well. It can create an even greater obstacle for homeowners to overcome in terms of paying off their debt. Creating more risk in an unstable economy is not the best option as of now.
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