Breached Levee’s & Underwater Mortgages If the housing bust and resulting recession are the equivalent of an economic hurricane (albeit a man-made one), what were the levees designed to hold back the flood waters? Certainly, the major ones were: –the role played — or not played — by the credit rating agencies, which blatantly mis-rated...Read More
Underwater . . vs. Drowned According to The New York Times, “about $500 billion in mortgage debt is already underwater” (“Bailout Likely to Focus on Most Afflicted Homeowners“). That’s realtor-speak for a house being worth less than the mortgage against it. Unfortunately, based on my calculations, that number appears to be conservative. Using industry statistics,...Read More
“‘Underwater’ Need Not Mean Foreclosure” That’s the title of a nice article in today’s Wall Street Journal. The article’s author makes the point — which I have observed — that most people who owe more than their home is worth keep making payments, regardless. Assuming they can. According to the article, the two biggest factors...Read More
