Subprime Lending
Abstract
The following information will describe the housing market crisis because of the sub-prime lending problems that have evolved immensely. It will provide a history of sub-prime lending, furthermore the crisis of the housing market, the market which it operates, government regulations, and issues or opportunities of the housing market.
Housing Market Crisis: Sub-Prime Lending
One of the major stories shown in the news for these past months has been the crisis of the housing market, sub-prime lending, and how it is impacting the United States economy. According to USA Today website, they stated that if the U.S. economy were a car, all of its warning lights would be flashing red because of the condition of the car. As mentioned by real estate agents, business organizations or individuals, “buying a home/property is the single best investment an individual could make during their lifetime”. This statement is actually true because real estate purchases are considered investment because in most cases the property goes up in value. For some people it has been their worst investment ever made in which at that time they possibly did not know what they where getting themselves into; and because their lender was somewhat irresponsible when processing the mortgage loan and disclosing all information. The information to follow will give more details to what is happening in the housing market in the U.S.
History of Industry: Sub-Prime Lending
As mentioned in the introduction, homeownership is one way that an individual can build wealth over a lifetime.
Market
Construction, sale and resale of residential properties across the country are what make up the United States housing market. In the U.S the housing market is at an all time low, the lowest in the past fourteen years. Calling it “financial Armageddon”, housing prices in the past had short term interest rates down to one percent and then were raised very...
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