What could possibly go wrong with 10% subprime mortgages?

Credit: 4closurefraud.org
Credit: 4closurefraud.org

They’re baack! Subprime mortgages are sneaking back into the market. One such mortgage required 35% down, $10,000 in fees, and has a whopping 10.9% interest rate. I’m guessing the fees and penalties should a payment be missed would be absolutely nosebleed. The borrowers said they planned to refi into a normal mortgage this year. Hmm, why do they think they’ll be able to do that when they couldn’t do it now?

Mortgage lenders are tip-toeing back into the subprime swamp. Surely this time is different. We will be more cautious, they say. Maybe. But in six months or a year, others probably won’t be nearly as cautious, banksters will start securitizing this risky glop, and due diligence on mortgages will go flying out the window again.

One comment

  1. Why not? They made so much money last time around…

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