Wednesday, July 25, 2007

Prime borrowers catching subprime ills

Prime borrowers catching subprime ills - Jul. 25, 2007:
"The subprime mortgage meltdown has begun to spread to prime loans as even credit-worthy borrowers have started to fall behind on payments.

On Tuesday, Countrywide Financial (Charts, Fortune 500), the nation's largest mortgage lender, attributed a big drop in profits to a spike in delinquencies among prime borrowers of 'second-lien loans,' including home equity loans and home equity lines of credit"
I'll admit being wrong about the spread of sub-prime woes into other markets. However, I guess I could argue that these piggyback loans are another ill-advised load to people who cannot afford the home in the first place.

People really need degrees in finance these days to avoid being overextended. I guess the banks and investors took the risk and are paying the price.

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