Are subprime mortgages back, and what does it mean if they are?

Some decisions are just hard, and GSEs have correctly and successfully resisted administration demands to reduce loan balances
  • The “new” 3 percent-down loans are nothing more than big banks snookering big media into free advertising for an old product easily available everywhere in one form or another.
  • It’s dangerous to loan with a small down payment. The antidote is not to deny credit access, but underwrite the bejabbers out of those loans.
  • During the Great Recession, we overdid well-intended efforts to keep hopeless households in their homes, even though any given block had vacant foreclosed rentals at a lower cost than the workout.

I’m going to try to be cheerful about this, but I’m not. I got invited last week to a very fancy small luncheon with a top Wall Street researcher/analyst — a household-name firm. The guy (in suspenders) spoke on real estate, mostly commercial, lucid (if general) information.