Sunday, September 24, 2006

Avoiding mortgage crisis is a priority

Are we in for a home crisis? I really don't think so, but I do feel we are in for a correction. Home prices rose too quickly and have priced out a large segment of the population. This in turn spawned creative financing for people who otherwise could not qualify for a loan. If the market backs up even a little bit, it's foreclosure city. So while I do not believe there will be a crisis, I feel that many mortgage institutions will begin tightening there lending, and some, who never should have bought too begin with, will lose their homes.

When the real-estate industry made it easy to borrow a lot of money, it also made it easy for people to get into financial trouble. Which is exactly what's happening, as foreclosures are surging across the country. Read More.

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