Download or read book The Subprime Mortgage and its Effects written by Jeremiah Cristobal and published by GRIN Verlag. This book was released on 2021-08-30 with total page 27 pages. Available in PDF, EPUB and Kindle. Book excerpt: Seminar paper from the year 2017 in the subject Economics - Finance, grade: A, , language: English, abstract: In late 2008, the U.S. suffered one of its greatest disasters in quite some time, the subprime mortgage crisis. It affected not only the housing market but the whole financial system as a whole. Cheap methods and greed are very possible motivators, leaving lenders, investment banks, and investors bankrupt. The whole system was going to fail from the beginning and could have been stopped or altered to have less damage, and yet only a few were able to see it’s great flaws. This caused thousands, and possibly millions of Americans to go homeless and unemployed. It gave more debt to the U.S. government worsening its ties with different countries. Since America has millions of international businesses and pledges, other countries were affected by its financial collapse. The actions and responses of the government, banks, and citizen themselves helped America to get up on both feet. This paper will explore the subprime mortgage to better understand the reason of its effect and collapse, to help others understand what it is and what can be done about it. Even if it had been almost a decade since the collapse, the subprime mortgages’ effects still affect us to this day. It’s also very likely that another similar event can strike anytime soon, this paper will help those keep a look out for tragedies and systems that he/she could avoid and potentially survive.

Download or read book Understanding the Securitization of Subprime Mortgage Credit written by Adam B. Ashcraft and published by DIANE Publishing. This book was released on 2010-03 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt: Provides an overview of the subprime mortgage securitization process and the seven key informational frictions that arise. Discusses the ways that market participants work to minimize these frictions and speculate on how this process broke down. Continues with a complete picture of the subprime borrower and the subprime loan, discussing both predatory borrowing and predatory lending. Presents the key structural features of a typical subprime securitization, documents how rating agencies assign credit ratings to mortgage-backed securities, and outlines how these agencies monitor the performance of mortgage pools over time. The authors draw upon the example of a mortgage pool securitized by New Century Financial during 2006. Illustrations.

Download or read book The Subprime Mortgage Collapse and Its Effects on the Economy written by Joseph Krmpotich and published by . This book was released on 2017 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: The subprime mortgage crisis occurred due to a number of factors. Included in these factors were the issuance of subprime loans, the securitization of mortgages in the investment banking system, and the deregulation and ultimate failure of the shadow banking system. These causes were evident in both historical trends in the stock market as well as the macroeconomic data leading into the crash. They were perpetuated by investors, mortgage brokers, and banks taking on an abnormal amount of risk in the early 2000s for both psychological and behavioral reasons. These causes, while less than obvious at the time, have, with the benefit of hindsight, become clearer. Thus, the subprime mortgage crisis and subsequent recession were entirely avoidable and could have been prevented.

Download or read book Effects of the Subprime Mortgage Crisis in New York City and Efforts to Help Struggling Homeowners written by United States. Congress. House. Committee on Financial Services. Subcommittee on Financial Institutions and Consumer Credit and published by . This book was released on 2008 with total page 96 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The impact of the Subprime Crisis on European Banks written by Jan-Frederik Modell and published by diplom.de. This book was released on 2008-04-22 with total page 84 pages. Available in PDF, EPUB and Kindle. Book excerpt: Inhaltsangabe:Abstract: The US subprime-crisis became a headline in the global media starting in February 2007 after the US housing market had already shown first signs of a slowdown in late 2006. Previously, the US housing market had enjoyed a favorable environment, especially from 2002 to 2005, which was characterized by low interest rates, rising house values, and increasing home financing possibilities through subprime mortgages. However, more and more events were published during the year by US mortgage brokers, international investment banks, and central banks around the world that presented a picture which caused today s perception of the subprime-crisis. What s more, the subprime-crisis is far from being over: an end to the crisis is not yet in sight. One rather unique characteristic of this crisis is that its actual basis is the delinquencies and defaults of subprime single-family home mortgages in the US which is commonly not regarded to be of great relevance for the international capital markets. However, taking into account the originate and distribute business model of US mortgage brokers in connection with the securitization of these mortgages into various types of securities that are traded on a global basis, it is not surprising to observe that banks and investment funds around the world were invested into these securities. Before the crisis started, only a few banks or funds considered the liquidity of these securities when investing significant amounts of money in them because they focused on maximizing their returns. But, when larger problems in the US subprime mortgage market became evident, liquidity became the major concern for investors and investor preferences significantly shifted to safer assets such as government bonds. This caused severe problems in the money market, which ultimately brought the crisis across the Atlantic to Europe. Moreover, funding problems emerged and caused the first bank run in Europe in decades when depositors in Britain started to queue outside Northern Rock branches for hours to withdraw their deposits in light of fears that the bank might have to file for bankruptcy. In addition, another British bank had been in the spotlight earlier that year because HSBC was the first European bank to announce a billion dollar write-off linked to its exposure to subprime mortgages. Taking into consideration the subprime-crisis-related events in Europe, the British banking market can be characterized as the [...]

Download or read book The National Homeownership Strategy written by United States. Department of Housing and Urban Development and published by . This book was released on 1995 with total page 120 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Impact of the Subprime Mortgage Crisis written by and published by . This book was released on 2009 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Impact of the Subprime Mortgage Crisis is an authoritative, insiders perspective on key strategies for representing and advising financially distressed clients affected by the recent crisis. Featuring partners from some of the nations leading law firms, these experts guide the reader through the evolution of prior market bubbles and recoveries, and offer insight as to how this crisis compares to previous economic downturns. These top lawyers reveal their thoughts on how we arrived at this recession, how the subprime mortgage crisis has changed bankruptcy practice, the importance of understanding your clients source of funding, and how to interpret emerging responses and solutions to the crisis. From discussing pending and decided cases impacted by the subprime mortgage crisis to identifying rule changes, these authors offer tips on navigating the current bankruptcy law environment, including what information and organizational resources can be helpful along the way. The different niches represented and the breadth of perspectives presented enable readers to get inside some of the great legal minds of today, as these experienced lawyers offer up their thoughts around the keys to practicing bankruptcy law in todays economic environment.

Download or read book Fraud and the Subprime Mortgage Crisis written by Tomson Hoang Nguyen and published by LFB Scholarly Publishing. This book was released on 2011 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Nguyen examines mortgage fraud as an inherent part of the subprime mortgage crisis. He traces the exponential growth of mortgage fraud to the loose underwriting standards, alternative loan products, and inadequate regulation and regulatory oversight of the subprime mortgage industry. He describes the various financial crimes constituting mortgage origination fraud, a form of fraud involving fraud for profit, fraud for property, and predatory lending. The accounts of mortgage frauds by industry insiders presented in this book provide a chilling view of the criminal implications of an unregulated financial industry. Nguyen proposes several broad recommendations highlighting the need to recognize the potential for insider fraud, enhance government regulation and oversight, tighten loan qualification requirements, and increase standards of underwriting.

Download or read book Effects of the Subprime Mortgage Crisis in New York City and Efforts to Help Struggling Homeowners written by United States House of Representatives and published by . This book was released on 2019-09-22 with total page 96 pages. Available in PDF, EPUB and Kindle. Book excerpt: Effects of the subprime mortgage crisis in New York City and efforts to help struggling homeowners: hearing before the Subcommittee on Financial Institutions and Consumer Credit of the Committee on Financial Services, U.S. House of Representatives, One Hundred Tenth Congress, second session, February 11, 2008.

Download or read book Real Effects of the Subprime Mortgage Crisis written by Hui Tong and published by International Monetary Fund. This book was released on 2008-07 with total page 64 pages. Available in PDF, EPUB and Kindle. Book excerpt: We develop a methodology to study whether and how a financial-sector crisis can spill over to the real economy, and apply it to the case of the ongoing subprime mortgage crisis. If there is a spillover, does it manifest itself primarily by reducing consumer confidence and consumer demand? Is there also a supply-side channel through a tightened liquidity constraint faced by non-financial firms? Since most firms appear to have much larger cash holdings than in the past, some suggest that a liquidity constraint is not likely to be a significant factor for non-financial firms. We propose a methodology to estimate the importance of these two channels for spillovers. We first propose an index of a firm's sensitivity to a shock to consumer confidence, based on its response to the 9/11 shock in 2001. We then construct a separate firm-level index on financial constraint based on Whited and Wu (2006). As a robustness check, we also construct an alternative sector-level index of a firm's intrinsic demand for external finance, based on the work of Rajan and Zingales (1998). We find robust evidence suggesting that both channels are at work, but that a tightened liquidity squeeze appears to be economically more important than reduced consumer confidence or spending in explaining cross-firm differences in stock price declines.

Download or read book The Subprime Solution written by Robert J. Shiller and published by Princeton University Press. This book was released on 2012-09-24 with total page 224 pages. Available in PDF, EPUB and Kindle. Book excerpt: A best-selling economist reveals the origins of the subprime mortgage crisis and puts forward bold measures to resolve it by restructuring the institutional foundations of the financial system in a thoughtful study by the author of Irrational Exuberance. First serial, The Atlantic.

Download or read book Effects of the Subprime Mortgage Crisis in New York City and Efforts to Help Struggling Homeowners written by United States Senate and published by Independently Published. This book was released on 2020-04-03 with total page 96 pages. Available in PDF, EPUB and Kindle. Book excerpt: Effects of the subprime mortgage crisis in New York City and efforts to help struggling homeowners: hearing before the Subcommittee on Financial Institutions and Consumer Credit of the Committee on Financial Services, U.S. House of Representatives, One Hundred Tenth Congress, second session, February 11, 2008.

Download or read book The Financial Crisis Inquiry Report written by Financial Crisis Inquiry Commission and published by Cosimo, Inc.. This book was released on 2011-05-01 with total page 692 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Financial Crisis Inquiry Report, published by the U.S. Government and the Financial Crisis Inquiry Commission in early 2011, is the official government report on the United States financial collapse and the review of major financial institutions that bankrupted and failed, or would have without help from the government. The commission and the report were implemented after Congress passed an act in 2009 to review and prevent fraudulent activity. The report details, among other things, the periods before, during, and after the crisis, what led up to it, and analyses of subprime mortgage lending, credit expansion and banking policies, the collapse of companies like Fannie Mae and Freddie Mac, and the federal bailouts of Lehman and AIG. It also discusses the aftermath of the fallout and our current state. This report should be of interest to anyone concerned about the financial situation in the U.S. and around the world.THE FINANCIAL CRISIS INQUIRY COMMISSION is an independent, bi-partisan, government-appointed panel of 10 people that was created to "examine the causes, domestic and global, of the current financial and economic crisis in the United States." It was established as part of the Fraud Enforcement and Recovery Act of 2009. The commission consisted of private citizens with expertise in economics and finance, banking, housing, market regulation, and consumer protection. They examined and reported on "the collapse of major financial institutions that failed or would have failed if not for exceptional assistance from the government."News Dissector DANNY SCHECHTER is a journalist, blogger and filmmaker. He has been reporting on economic crises since the 1980's when he was with ABC News. His film In Debt We Trust warned of the economic meltdown in 2006. He has since written three books on the subject including Plunder: Investigating Our Economic Calamity (Cosimo Books, 2008), and The Crime Of Our Time: Why Wall Street Is Not Too Big to Jail (Disinfo Books, 2011), a companion to his latest film Plunder The Crime Of Our Time. He can be reached online at www.newsdissector.com.

Download or read book The Case for Banning Subprime Mortgages written by Alan M. White and published by . This book was released on 2010 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: While the subprime mortgage boom was in full swing, its benefits to American society were widely touted. Subprime mortgages were said to have increased homeownership. The subprime effect was supposed to have been especially strong for low-income and minority families previously unable to buy homes. The democratization of credit was also attributed to subprime mortgages.The empirical data do not support these welfare claims. The U.S. homeownership rate increased somewhat between 1994 and 2007. Subprime mortgages, however, were mostly made to existing homeowners to refinance debt; very few were made to first-time home buyers. The number of homes lost due to subprime foreclosures significantly exceeded the new homeowners added by subprime mortgages. Subprime mortgages also displaced the safer and lower-cost FHA loans that would otherwise have been made. Conventional prime mortgages for purchases fully accounted for the observed increase in homeownership.The welfare harms caused by subprime mortgage lending are readily measurable. They include the direct impact of more than two million foreclosures on families, the resulting property value losses, the social and fiscal impact on cities where subprime mortgages were concentrated, the price discrimination resulting in black and Latino homeowners paying unnecessarily high rates, and the broader impacts on the credit markets and the economy. The disastrous consequences of subprime mortgage lending were in part the result of deregulating mortgage interest rates. Similar harms can be prevented in the future by re-imposing reasonable interest rate limits on first-lien mortgages. FHA should be restored to its role as the primary provider of mortgages to first-time, low- and moderate-income home buyers.

Download or read book Subprime Mortgages written by Edward M. Gramlich and published by The Urban Insitute. This book was released on 2007 with total page 124 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over the past decade, a new mortgage market offering loans at low interest rates and for little or no money down has given low-income people an opportunity to pursue the American dream of homeownership. The resulting wave in home buying promised to stabilize neighborhoods and families, boost the economy, and reduce crime. In many ways, the optimists were correct, but now, less than fifteen years later, the subprime mortgage market is collapsing, threatening to take the rest of the housing sector along with it.Subprime Mortgages: America's Latest Boom and Bust analyzes how the subprime market emerged, why it is in crisis, and how we can reform public policy to avert disaster. An attendant examination of the rental market also offers recommendations for shoring up what may be the best housing option for some families.

Download or read book Impact of the Subprime Mortgage Crisis on Community Health written by Christopher A. Mothorpe and published by . This book was released on 2008 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Loans originated to borrowers with lower incomes and/or lower credit scores are classified as subprime. The spatial distribution of subprime loans is alarmingly concentrated in minority-dominated and low-income areas. Beginning in mid 2006 the subprime mortgage market began to see elevated levels of delinquent and defaulted loans. The causes are many but generally traced to the beginning of the reset periods for adjustable rate mortgages and the evaporation of demand for securitized subprime mortgages. As delinquent and default rates in subprime mortgages rise, areas with a concentration of high-risk borrowers are at risk to decline. The decline can be measured across four different groups of factors that indicate the health of a community. The four groups are: physical, institutional, socioeconomic and the residential body. The residential body factor group refers to the citizens of a community and their civic involvement. The analysis uses binary logistic regression to identify communities that are commonly associated with subprime mortgage defaults. Subprime loans in the ten-county Atlanta Metropolitan Area are the focus of the study. The analysis treats each census tract in the ten counties as an individual community. The sample loans are geocoded to the census tract level allowing defaulted loans to be tied to communities and their characteristics. The data is collected from a variety of sources including the U.S. Census Bureau, the Atlanta Regional Commission and RR Donnelley s Credit Risk Management database. The results indicate that the probability of subprime mortgage defaults are associated with higher vacancy rates, population loss, declining property tax revenues, depreciating property values, and declining owner reinvestment in their properties. Potential spill over impacts to the community include higher crime rates, decreased school funding and degradation of public infrastructure.

Download or read book Finance Development June 2008 written by and published by INTERNATIONAL MONETARY FUND. This book was released on 2008-06-10 with total page 57 pages. Available in PDF, EPUB and Kindle. Book excerpt: The June 2008 issue tackles the crisis in financial markets in industrial countries from a number of angles. Articles look at the origins of the crisis in the subprime mortgage market in the United States and track its spillover into other markets. Then authors examine what can be done to prevent future crises. Other articles look at bank capital adequacy rules and Basel II, whether emerging markets and industrial economies are decoupling or converging, capital flows to low-income countries, efforts to achieve the MDGs, and currency intervention. Back to Basics looks at over-the-counter (OTC) markets and the People in Economics column profiles Jacques Polak. Picture This is on the digital divide.