Could some one from down south give me their take on what is happening with the credit situation that's happening down?
U.S. Credit Crunch
- Thread starter Albertabound
- Start date
Too much money was leant to too many people who shouldn't have received loans. This fueled a housing boom. Now, the subprime loans are falling in price because people don't have the income to pay it back, and now housing prices are falling, which means that for many, they owe more than what the property is worth. Many of these lousy loans were packaged into pools of mortgages and given investment-grade ratings by the ratings agencies based on financial models that had never been tested in such an environment. Those pools were then sold to investors, who used these assets to back up loans and credit. Now, the pools of mortgages are worth less than originally thought and financial institutions that had used these pools to secure loans are now having to sell good assets to raise cash to fund the losses, and are no longer making loans, or as many loans, because their capital base has taken a hit. This is causing a restriction in credit throughout the money and inter-bank markets, and investors are now re-assessing risk premiums for all sorts of loans - which had been too low IMO - which means the same loan today requires a higher interest rate than it did six months ago, which has the effect of restricting. This isn't seizing all credit markets - you can get a qualifying mortgage for 6.5% today - but it has caused a shut-down in specific parts of the credit market, particularly in the cash markets.
Toro you are faster than the speeding bullet!!!
No sooner do I find a topic you are on - you have vacated the premises hehe...
I was going to lease a new auto this year and unload my vehicle as I am unencumbering myself of posessions.... will the leasing business be affected adversely too? Thank you and how much do I owe you? :smile:
No sooner do I find a topic you are on - you have vacated the premises hehe...
I was going to lease a new auto this year and unload my vehicle as I am unencumbering myself of posessions.... will the leasing business be affected adversely too? Thank you and how much do I owe you? :smile:
Hi Curio
It shouldn't have an effect. And if it does, then just wait a bit and it will eventually pass.
What type of car are you looking at?
It shouldn't have an effect. And if it does, then just wait a bit and it will eventually pass.
What type of car are you looking at?
Well GM just announced a 1000 person lay off effective January 2008 at a plant here in Canada. Another indicator of where the U.S. economy is at. Do you not agree?
Some other indicators are Walmart and Home Depot showing big quarter losses. You might notice these companies advertising a little more these days. I know I have.
Some other indicators are Walmart and Home Depot showing big quarter losses. You might notice these companies advertising a little more these days. I know I have.
My favourite part of this story is all the attention to the stock market tumbles and how to fix the problem of loans defaulting...
And no one asking about what happens to all these people losing their homes? You know what else would prevent this from happening again? Mortgages with a fixed rate for the entire term. Then people would get to keep their homes, defaults would be way down, and profits, if lower, would be stable.
The if lower is the clincher though, apparently thats crazy talk.
And no one asking about what happens to all these people losing their homes? You know what else would prevent this from happening again? Mortgages with a fixed rate for the entire term. Then people would get to keep their homes, defaults would be way down, and profits, if lower, would be stable.
The if lower is the clincher though, apparently thats crazy talk.
Thanks Toro
I am going to start looking in September for a sports model 2-dr. Lexus, another MB or a BMW318 - they run between 300-400/month 3 year lease with approx $4,000 obligatory down plus T&L. I like the new BMW but my girlfriend has a Lexus and it has a few neat features....
My mileage on the MB is now up to 4700 hahaha...maybe I should just get a golf cart! Right now it has some good value in resale...but I'm not in a hurry - just looking - I want to do it before next spring.
I am going to start looking in September for a sports model 2-dr. Lexus, another MB or a BMW318 - they run between 300-400/month 3 year lease with approx $4,000 obligatory down plus T&L. I like the new BMW but my girlfriend has a Lexus and it has a few neat features....
My mileage on the MB is now up to 4700 hahaha...maybe I should just get a golf cart! Right now it has some good value in resale...but I'm not in a hurry - just looking - I want to do it before next spring.
Zzarchov there are scams aplenty where I live
Groups of people were getting 110% mortgages with nothing down - not paying anything monthly and
being kicked out at 6 months - meanwhile they have had free living - and you should see the condition of the houses... no outside watering... no yard care - I can imagine what the interiors look like...
Many of them were undocumented so permanent 'residency' wasn't something they believed would happen anyway.
Whoever thought 110% would glean reliable people is a crook.
Just my opinion but it looks like a repeat of 1907. Hang on to your shorts, because that's all you'll have left.
Get a BMW 5 series, my wife has one and it rocks.
Huh, she gets the car and I get the van, how did that happen?
It's okay though, my toy is almost ready to come out of winter hybernation.....
