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| *Ostroff, Fair and Company>>>Corporations |
Were Sub-Prime Lenders just plain greedy, stupid or both? |
They want to make money in the long run, so the rates kept going up. To the point people could no longer make payments, thus having to foreclose. Did they not forsee that people would have to foreclose? Or did they figure, that people could continue making the payments, but would have to give-up and tighten-up on everything else? The Sub-Prime Lenders will all eventually burn in hell. Along side Abortion doctors, Terrorists, drug dealers, etc. It is all about money. Or in other words risk verses reward. This is no different then risky stocks or any other investment. Sure as risk goes up it implies that people will default and they will lose money, but it also implies that they can charge more for these people. So what they try to do is just make sure the money coming in is greater then the money lost. P.S. Sometimes they guess wrong about the trade off and they go under. Money lenders, by definition are greedy, and studies have now proven that stupid people are more financially successful than smart people. Foreclosure means the lenders get the property and all the money you paid them. Then they can re-sell the property, so I fail to see how that is stupid. In other words, they got your money, and they got your house, despite the fact that you were paying for it. That is highly profitable. It is the very reason they had to enact laws about when they could foreclose, because so many of them realized they could keep foreclosing and reselling over and over to make three times what a property was worth. As for them burning in hell, well, thats an existential question I can't answer. they were greedy and stupid and arrogant and should be held criminally accountable. http://letsgobble.com/ AMZI,, are you always so wrong about a subject or did you just lose your home?? people know up front what their payments will be,, lenders don't change rates unless it's an adjustable mortgage. People with poor credit get a sub prime loan and pay higher interest rates. The lenders figure on a certain number of defaults, that's why the rates are higher. |
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