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Non-Tech : Investing in Real Estate - Creative Opportunities -- Ignore unavailable to you. Want to Upgrade?

To: John Vosilla who wrote (2517)	12/26/2015 11:43:18 AM
From: Riskmgmt	Read Replies (1) \| Respond to of 2722

"What we would pay here for a down payment you could take to another market and pay cash for a house," So instead of looking at this as a warning sign of an overextended housing market this credit union sees it as an opportunity to capture market share? Question they should be asking is, If local housing prices fell 30-50% would these borrowers with excellent credit walk away from a potential 500k to a million loss? The answer looking at the recent history of Florida, Arizona and parts of their own state a resounding YES!!. It wasn't just sub-prime borrowers who walked but also high FICO's. They even coined a term for the practice "strategic default" meaning can afford to pay but sees it as a financially unwise course of action when walking away has no real penalty when compared with that magnitude of a loss. But then prices in San Fran never go down do they, everybody knows that:-) It took over 20 years from the Saving and Loan crisis to the 2006 crisis so I thought it would be at least that long before the craziness in lending returned but maybe your right John, it's starting already. R.