How are mortgage loans the root impose of the rising number of edge failure.?
I don't understand! If a bank lend the home buyer money to purchase a home and the purchaser makes payments for some period of time but ultimately have to default on the loan, doesn't the bank take home money? It receives the payments, forecloses on the home and can then resell the home to another buyer. If the flea market is depressed, can't the bank retain the home as an asset until the market returns to commonplace? So, if these statements are true, how can the bank blame loan defaults as the lead to of the failure?
Answers:
Since your statements are NOT true, your whole premise falls apart.
If the dune lends $80,000 on a home and the buyer makes payments for a few years, no they haven't rewarded back anywhere near the amount they borrowed, so the ridge loses money if they can't sell the home for what's still owed and that's often the covering. And the bank's business is lending money, not holding real estate for years hoping it will move about back up to what someone owed on it when they quit paying. And you're forgetting that for that time the bank would enjoy their money tied up in that house.
On some foreclosures the bank might receive money, but in the falling housing market the later few years, typically it's been a loss. Many loans were given to ethnic group who couldn't afford them in the first place. This is partially the eccentricity of the buyers, partially the lenders who should have specified better than to make these loans, and partially the error of the government who strongly encouraged the lenders to receive marginal loans.
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Answers:
Since your statements are NOT true, your whole premise falls apart.
If the dune lends $80,000 on a home and the buyer makes payments for a few years, no they haven't rewarded back anywhere near the amount they borrowed, so the ridge loses money if they can't sell the home for what's still owed and that's often the covering. And the bank's business is lending money, not holding real estate for years hoping it will move about back up to what someone owed on it when they quit paying. And you're forgetting that for that time the bank would enjoy their money tied up in that house.
On some foreclosures the bank might receive money, but in the falling housing market the later few years, typically it's been a loss. Many loans were given to ethnic group who couldn't afford them in the first place. This is partially the eccentricity of the buyers, partially the lenders who should have specified better than to make these loans, and partially the error of the government who strongly encouraged the lenders to receive marginal loans.
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