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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Les H who wrote (47622)	1/23/2006 10:19:13 AM
From: Les H	Respond to of 306849

Home equity loans or refinancing one's ever-appreciating home have compensated for flat or declining earnings, but that particular ATM machine has closed with the leveling off of the housing market. For many people, the only readily available credit left this side of bankruptcy is their credit cards. Delinquencies among credit card holders have been running around 4 percent. The credit card business is so lucrative the banks that own the card companies have no problem with that. If that number were to gradually climb to 12 percent or even 15 percent, they would have a problem. Since they have to pay the merchants whose customers used the card regardless, delinquency rates at those levels would take a noticeable bite out of profits. If the companies use the new laws to force their customers into bankruptcy, zombie status is practically automatic. Under the new law the bankrupt does not have his debts washed away, only reduced. If the credit card companies do not drive their card holders into bankruptcy, the payment arrangements they make will zombify their debtors anyway. There is another way. The bankruptcy law in the early Roman Republic tolerated no zombie-ism: thenation.com