Sentences with phrase «mortgage bubble collapsed»

Once the inflow of new employee contributions slows, the rise in stock prices will collapse, just as the mortgage bubble collapsed.

Not exact matches

Weakening currencies in the post-Soviet states threaten to raise default rates on foreign - currency mortgages as collapse of the Baltic real estate bubble drags down Swedish banks, while the Hungarian property plunge threatens Austrian banks.

And everyone acknowledges that it was the sharp mid-decade run - up in interest rates that burst the bubble and caused the collapse in US housing prices and in the value of those mortgage - backed securities that are still wreaking havoc on bank balance sheets all around the world.

After a market slide of more than 50 %, investors again pushed the Shiller multiple beyond 24 during the housing bubble and cash - out financing free - for - all that ended in the recent mortgage collapse.

Fed - induced yield - seeking speculation is precisely what drove investors to seek refuge in mortgage securities, provoked the housing bubble, and ultimately produced the worst economic collapse since the Great Depression.

The bubble was a combination of (a) teaser rates on option ARMs which were like financial time bombs, (b) liar loans in which the rules of good mortgage underwriting (20 % down, 28/36 ratios) went out the window, (C) people at rating agencies who decided that if one pools enough junk loans into one bond, it's magically AAA, and (D) Credit default swaps which encouraged these bad loans, and when they collapsed a number of people walked away with billions of dollars.

[102] Testimony given to the Financial Crisis Inquiry Commission by Richard M. Bowen III on events during his tenure as the Business Chief Underwriter for Correspondent Lending in the Consumer Lending Group for Citigroup (where he was responsible for over 220 professional underwriters) suggests that by the final years of the US housing bubble (2006 — 2007), the collapse of mortgage underwriting standards was endemic.

However, in the years following the 2008 U.S. financial collapse, which stemmed in part from a housing bubble caused by irresponsible mortgage lending, the housing market endured huge turbulence.

In the wake of the housing bubble's collapse, FHA loans have taken on renewed importance for today's mortgage borrowers.

Furthermore, the credit crunch related to the subprime mortgage crisis and the collapse of the housing bubble caused a flight to insured government bonds funds, which negatively affected prices of other non-insured bonds of varying credit quality.