Mortgage Market Breakdown by Equity/Delinquency

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Laurie Goodman and the Amherst Securities Group tries to determine the size and scope of the housing problem:

This article summarizes the size and scope of the housing crisis, making the point that if governmental policy does not change, one borrower out of every 5 is in danger of losing his/her home. A crisis of this order of magnitude requires both supply and demand side measures. On the supply side, a successful modification is critical. This will require principal reductions to re-equify the borrower. The moral hazard (strategic default) issues must be addressed by first recognizing that this is an economic issue, not a moral one. Second liens must also be addressed. As supply side measures alone are likely to prove insufficient to address a crisis of this size, we discuss demand side measures to increase the buyer base.

The full report, if you can track it down, is here and worth reading.


The Housing Crisis—Sizing the Problem, Proposing Solutions
Amherst Mortgage Insight, October 1, 2010

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