Wednesday, December 31, 2014

Expert: Another Housing Bubble is Likely if We don't Change Our Policies

Another Housing Bubble is Likely if We Don't Change Our Policies

Earns Fannie MaeFannie Mae Headquarters in Washington, D.C.

The reason why we had the housing bubble to begin with in 2008 was because the government told investment banks to water down requirements for homeowners to purchase themselves a home.  One time in 2000, they were beginning to accept zero down payments.  These subprime loans were killing us because those who were trying to purchase a home didn't qualify and it ruined the housing market.  The same thing is likely to happen again as long as the government is in the basis of making housing "affordable".  If prospective homebuyers can't afford to make the payments, then they don't need to be given a housing loan.  It's as simple as that.

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