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July 3, 2009
WSJ editorial: New evidence points to zero money down, not subprime loans, led to the mortgage meltdown
Topics: Political News and commentariesUh-Oh; Stan Liebowitz writes that evidence from a huge national database containing millions of individual loans strongly suggests that the single most important factor is whether the homeowner has negative equity in a house -- that is, the balance of the mortgage is greater than the value of the house. This means that most government policies being discussed to remedy woes in the housing market are misdirected:
[...] We are at a crossroads where we can undo the damage to the housing market by strengthening underwriting standards in a reasonable way. But to do so political leaders must face up to the actual causes of the mortgage crisis, not fictitious causes that fit political agendas and election strategies.In other words, we're in deep trouble and headed deeper.
Posted by Abdul at July 3, 2009 10:22 AM
Articles Related to Political News and commentaries:
- WSJ editorial: New evidence points to zero money down, not subprime loans, led to the mortgage meltdown - Jul 03, 2009
