Re-visiting the Origins of the 2007 Global Credit Crisis
Subprime Loans: The Under-the-Radar Loans that Felled a Market
Subprime Loans and Associated Risks
The housing crisis beginning in 2007 resulted in approximately 1.5 million foreclosed homes that year and at the time predicted increases in future years according to Joseph Gilbert (2011). Mr. Gilbert also states that “[a]lthough subprime mortgages accounted for less than 20 percent of all mortgages outstanding, just over half of these foreclosure initiations were on subprimes (2011, p. 88). A subprime loan is a loan given to “individuals who do not qualify for prime rate loans” under normal circumstances (Gilbert, 2011, p. 89). Many attribute owning a home to be the most central element towards obtaining ‘The American Dream’, but there were many elements that contributed to…and resulted from the Subprime Loan Housing Crisis.
Jeff Holt summarizes the contributing factors of the housing crises in 4 primary causes. They are low mortgage interest…
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