Quote:
Originally Posted by Avatard
I missed the part where homeowners actually caused the housing price bubble, and then benefited from its crash, resulting in one of history's greatest land grabs by banking robber barons since before the Fed was established.
Oh, wait...that's because that's not exactly how it went, right?
 |
You think banks caused the pricing bubble on their own? Home buyers bid prices up to unprecedented levels because who cares its free money and hey if they can't afford the payments they will just sell at a profit to someone else who is getting free money because real estate values never go down. That isn't exactly how it went either, is it?
You also think banks want to own all the property they got in this "land grab" as you call it? The banks only own those properties because the buyers stopped making payments and their loans are for more than the properties are now worth. Each property that goes in to foreclosure has a gap between what the property is worth and the value of the existing balance on the mortgage. That difference isn't speculative, it is a real loss to the banks since those banks actually paid out real cash money for the properties that were purchased. They would be much better off financially if homeowners just kept paying their loans. Instead they now have inventories of homes that are worth a fraction of the real money the banks loaned out for them. Every piece of land they got in this "land grab" has a financial loss attached to it.