The Rich are different they default and don't care
Started by Riversider
over 15 years ago
Posts: 13572
Member since: Apr 2009
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http://www.nytimes.com/2010/07/09/business/economy/09rich.html?_r=1&ref=business More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic. By contrast, homeowners with less lavish housing are much more likely to keep writing checks to their lender. About... [more]
http://www.nytimes.com/2010/07/09/business/economy/09rich.html?_r=1&ref=business
More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.
By contrast, homeowners with less lavish housing are much more likely to keep writing checks to their lender. About one in 12 mortgages below the million-dollar mark is delinquent.
Though it is hard to prove, the CoreLogic data suggest that many of the well-to-do are purposely dumping their financially draining properties, just as they would any sour investment.
“The rich are different: they are more ruthless,” said Sam Khater, CoreLogic’s senior economist.
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Response by Riversider
over 15 years ago
Posts: 13572
Member since: Apr 2009
The delinquency rate on investment homes where the original mortgage was more than $1 million is now 23 percent. For cheaper investment homes, it is about 10 percent.
With second homes, the delinquency rate for both types of owners was rising in concert until the stock market crashed in September 2008. That sent the percentage of troubled million-dollar loans spiraling up much faster than the smaller loans.
“Those with high net worth have other resources to lean on if they get in trouble,” said Mr. Khater, the analyst. “If they’re going delinquent faster than anyone else, that tells me they are doing so willingly.”
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Response by Riversider
over 15 years ago
Posts: 13572
Member since: Apr 2009
Were these borrowers really "rich"? Or did they just buy more home than they could really afford?
But I thought you republicans blamed this whole crisis on Barney Frank pushing mortgages for the poor ????
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Response by Riversider
over 15 years ago
Posts: 13572
Member since: Apr 2009
He's mostly responsible for subprime and the disaster at Fannie Mae.
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Response by nyc_sport
over 15 years ago
Posts: 809
Member since: Jan 2009
As usual statistics are a dangerous thing. To say that 1 in 7 vs 1 in 12 mortgages are in arrears at different price points says nothing. The numbers are meaningless since probably only one or two percent of mortgages are over $1 million. And, it is far, far more likely that a mortgage over $1 million was written in the past 5 years when police, fireman and school teachers thought a million dollar house was within their reach, and thus it would be unsurprising to see a relative percentage of greater delinquencies in a pool of recent mortgages. Finally, "rich" people don't have mortgages, so the logic of this story is circuitous.
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Response by streetsmart
over 15 years ago
Posts: 883
Member since: Apr 2009
The democrats have been pushing mortgages for the poor since the community reinvestment act was passed in the 1970's.
But the rich have been taking out mortgages since the money has been so cheap.
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Response by somewhereelse
over 15 years ago
Posts: 7435
Member since: Oct 2009
> But the rich have been taking out mortgages since the money has been so cheap.
Helped along in part by the interest deduction, which amazingly goes up to a million in principal.
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Response by Riversider
over 15 years ago
Posts: 13572
Member since: Apr 2009
Were these people rich or people/couples earning between 100-250K and borrowed with little or no equity down?
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The delinquency rate on investment homes where the original mortgage was more than $1 million is now 23 percent. For cheaper investment homes, it is about 10 percent.
With second homes, the delinquency rate for both types of owners was rising in concert until the stock market crashed in September 2008. That sent the percentage of troubled million-dollar loans spiraling up much faster than the smaller loans.
“Those with high net worth have other resources to lean on if they get in trouble,” said Mr. Khater, the analyst. “If they’re going delinquent faster than anyone else, that tells me they are doing so willingly.”
Were these borrowers really "rich"? Or did they just buy more home than they could really afford?
http://www.calculatedriskblog.com/2010/07/foreclosures-movin-on-up.html
But I thought you republicans blamed this whole crisis on Barney Frank pushing mortgages for the poor ????
He's mostly responsible for subprime and the disaster at Fannie Mae.
As usual statistics are a dangerous thing. To say that 1 in 7 vs 1 in 12 mortgages are in arrears at different price points says nothing. The numbers are meaningless since probably only one or two percent of mortgages are over $1 million. And, it is far, far more likely that a mortgage over $1 million was written in the past 5 years when police, fireman and school teachers thought a million dollar house was within their reach, and thus it would be unsurprising to see a relative percentage of greater delinquencies in a pool of recent mortgages. Finally, "rich" people don't have mortgages, so the logic of this story is circuitous.
The democrats have been pushing mortgages for the poor since the community reinvestment act was passed in the 1970's.
But the rich have been taking out mortgages since the money has been so cheap.
> But the rich have been taking out mortgages since the money has been so cheap.
Helped along in part by the interest deduction, which amazingly goes up to a million in principal.
Were these people rich or people/couples earning between 100-250K and borrowed with little or no equity down?