More Subprime Borrowers Are Missing Loan Payments

https://www.wsj.com/articles/more-subprime-borrowers-are-missing-loan-payments-11652952602

by lxm • 4 years ago

183 190 4 years ago

wsj.com

quux• 4 years ago

https://archive.ph/SL4Q4

yumraj• 4 years ago

I was just thinking about this today.

Given the very low interest rates in 21-22 and high prices, a certain percentage of folks would have purchased with a convertible mortgage.

Assuming the standard 5-1 and the fact that rates are rising very fast, should we expect a repeat of 2008 in 2026-2027?

UncleOxidant• 4 years ago

I thought adjustable rate mortgages were pretty much dead after '08? Why would anyone get an ARM when rates were in the 3% range for a 30 year fixed mortgage (as they were for several years until recently)?

lkjfdslkjf2222• 4 years ago

Don't know numbers off hand but we had a <4% rate ARM because it was the lowest rate and we liked the flexibility of paying it off asap (or if something happened, paying it off over 30 years) versus a 15-year fixed.

Plenty of other reasons. Others have bad credit or otherwise get significantly lower payments on an ARM compared to fixed.

I guess there are other reasons, but ARMs are definitely not dead. I don't know the numbers or where to get them though.

What are more dead are the "balloon payment" residential mortgages where they may amortize over 30 years but the principal is due in 5 or 10 years.

dmitrygr• 4 years ago

Because ARMS were in the 2.x% range.

I talked a number of people out of ARMs in '21 and '22 by explaining 2008 to them (they were 7-8 years old at the time, so do not remember). It is scary how bad most people are at understanding exponential growth and just how much worse 5% is than 3%

mgkimsal• 4 years ago

I went through 2 ARMs between 2013 and 2021. In both cases the 7 year ARM was at least 1.5 % below the traditional 30 year I could get. Between lender rebates and such, in both cases we had essentially $0 out of pocket and in both cases a moderately. In the last couple years, the ARMs I looked at were less than a single % from a traditional 30 year. I had last 3% ARM was adjusting in mid 2023, and I refi'd to a 30 year @ 2.75% last October. Holy tamole things have changed since then!

bgirard2• 4 years ago

Say you take a 7 ARM at 2% instead of 3% for a 700k mortgage. You're saving $50,000 in interest during the first 7 years. That's 7% of your mortgage. Then 7 years of inflation can knock down your principle further which might be pretty high over the next 7 years.

It can make sense if you're financially secure enough to take on the risk.

gnopgnip• 4 years ago

Something like 60% of homeowners would come out ahead financially with an ARM. You can save tens of thousands of dollars in interest before the rates adjust. Many people sell or refinance before the rates adjust, or soon after. The rate early on is a little more important because that is when the principal is highest, but in practice this isn't a huge factor. Only about 35% of the original principal is paid off after 10 years for a 5% mortgage. Even if rates go up and you stay there for 15-30 years, you could come out ahead because of how much lower the interest was for the first 5-7 years. But it depends on how much rates go up.

But the long tail is some people being priced out of their home as their payment rises, and it could have been prevented. So 90-95% of mortgages in the US are fixed rate.

caeril• 4 years ago

Same reason very intelligent fund managers are buying 10y TSYs yielding 2.8% despite inflation giving them a NEGATIVE 5.2% real yield:

Everyone thinks that 5 years out, everything will be rosy. The metalworker saving 0.6% on a 5/1 ARM vs a fixed 30yr is using the same mental gymnastics that J. Poindexter on Goldman's bond desk is, that central banks are omniscient, omnipotent, and will always magic away the risk inherent in our decisions.

grahamperich• 4 years ago

With rates climbing to 5%+ in the last couple months, a 3% ARM (with the hope they could refi to a low interest 30yr fixed before the ARM becomes adjustable) may have been attractive for some..

Kerrick• 4 years ago

Also worth noting: not all ARMs have a balloon payment. For example, I bought most of my farm on a 20yr ARM with a 20yr amortization. As interest rates rise I will have higher payments, but there’s no moment when the music stops and the rest of the principle immediately comes due.

codefreeordie• 4 years ago

Before I gave up on buying a house this year, I was considering an ARM. Why? Because it meant I could qualify for an extra $100k, which gave me a better chance of being able to acquire a house.

It didn't matter whether an ARM was better or worse in the long run, it mattered that the ARM could get the house and the fixed rate could not.

dragonwriter• 4 years ago

Given the very low interest rates in 21-22 and high prices, a certain percentage of folks would have purchased with a convertible mortgage.

Convertible mortgages became popular as an alternative to either fixed or nonconvertible ARMs when rates were high as a way to preserve the option of locking in on a rate drop without going through a refi. Convertibles don't offer a lot when rates are low—if you want to be able to lock in a low rate and rates are already low, you get a fixed.

Between that, changes in qualification rules, and memories of the collapse leading into the Great Recession, ARMs of all types have shrunk to a very small share (<5%, IIRC) of residential mortgages, and newer ARMs tend to have rate caps.

Assuming the standard 5-1 and the fact that rates are rising very fast, should we expect a repeat of 2008 in 2026-2027?

Probably not because of adjustments on existing mortgages. If there is sustained stagflation, then the fact that people can't pay their fixed-rate mortgages given other necessary expenses may produce a similar collapse, though.

vmception4• 4 years ago

2008 was an accounting and leverage problem.

Every product in 2008 was completely viable which is why the Federal Reserve bought everything.

Only 7% of the borrowers defaulted by then, there wasnt mass irresponsibility on the people with mortgages as suggested, this alone blew up some institutions because they were leveraged nearly 50x and one month of missed mortgage payments would cause a massive drawdown on their portfolio.

Without leverage, a portfolio where 93% is going to pay a lot in interest over 5-30 years is a good portfolio.

So there is no reason to get uncomfortable or anxious by seeing the words “subprime” “CDOs” or more, as it comes down to whether the accounting is done properly and the leverage is low. Which, I believe is being done. The "big crash" always comes from a different and unexpected (or less expected) angle, where some completely different sector has too much leverage and flimsy accounting.

jjoonathan2• 4 years ago

Yes, a disappointing fraction of armchair generals are fighting the last war.

What are the big speculative candidates for next crash? Contagion from the Chinese real estate market?

tootie2• 4 years ago

And as much as Dodd-Frank was watered down, the orderly liquidation provisions survived and that means regulators have full authority to stop a situation like Bear Sterns or Lehman collapsing and taking down a sector of the economy with them.

x86_64Ubuntu• 4 years ago

I thought 2008 was because 'D' grade mortgages were repackaged into 'AAA' grade securities. When the 'D' grade folks missed payments and defaulted, it brought everything down because their securities had tainted so much of the landscape.

Finnucane• 4 years ago

That was one factor. There was no single cause, but a fragile interconnected web of factors.

But yes, subprime loans were carved up and repacked in a way to make them look like AAA bonds. The banks that created these bonds knew that the loans in the bonds were crap; they knowingly lied to investors about it. The ratings agencies stamped all the bonds without any due diligence. Other banks piled on more derivative products on top of those bonds, essentially gambling on whether those bonds would go bad.

There was a slime-trail of fraud, laziness, and greed all the way back the original loan itself.

yardie3• 4 years ago

2008 was a lot of 'AAA' grade securities not being able to find a greater fool to keep the profit train running. A lot of financial instruments were basically repacking and reselling loans with a bit of interest on top. Once there were no more new buyers it was a cascade of margin calls.

Subprime was a very small cause of the GFC but it was the tipping point that brought the house down.

treis• 4 years ago

ARMs were not the problem in 08. The problem in 08 was interest only loans and/or balloon payments. Borrowers were intending to refinance before those deadlines hit but got stuck once values stopped rising. So they faced payments of 10s of thousands and/or their monthly payment was going to double or triple once they had to start paying principle down.

In contrast, if your arm resets from 3% to 7% it's like a 50% increase in mortgage payments. That sucks, but manageable given that your salary likely inflated along with your payment.

ziddoap• 4 years ago

but manageable given that your salary likely inflated along with your payment.

Which, anecdotally, has not been true for myself or any of my colleagues (barring the ol' job switch raise). Wage stagnation is an extremely common problem in many countries and industries. Those that have gotten or negotiated for raises aren't getting raises that account for the record-setting inflation (at least in my country, which is seeing the highest rates of inflation in 30+ years)

hbosch• 4 years ago

That sucks, but manageable given that your salary likely inflated along with your payment.

Can I reside in a world where my salary doubles if my mortgage rate doubles? It sounds very nice.

fundad• 4 years ago

The article's subhead lists everything but mortgage: car loans, personal loans and credit card debt. That's where the growth has been. I remember hearing about 7 year car loans being a risky way to sell more more car loan for the same monthly budget.

There was also record high amounts paid back in 2020. I'd like to know if they adjust for that or just more fear-mongering by big banks, admitedly I'm too cheap to read further to find out.

incomingpain• 4 years ago

Given the very low interest rates in 21-22 and high prices, a certain percentage of folks would have purchased with a convertible mortgage.

The 'certain percentage' actually went over 50% of new mortgages, excluding refinancing.

Assuming the standard 5-1 and the fact that rates are rising very fast, should we expect a repeat of 2008 in 2026-2027?

You would think so but no. We should expect it in 2022 primarily harming the large cities.

bogomipz2• 4 years ago

Why would someone have opted for for an adjustable rate mortgage that adjusts after 5-7 years when they could have locked in a historic low rate for 30 years?

localhost• 4 years ago

In my case it’s because I don’t anticipate being in the house longer than the rate lock period

mrep• 4 years ago

I just got a 10/1 ARM because second home rates spiked recently [0] so the ARM was a lot lower (I think 1.125%) than a 30 year fixed.

[0] https://www.ezhomesearch.com/blog/second-home-mortgage-rates....

2Gkashmiri2• 4 years ago

so....... good time to wait for the next crash and buy the dip?

lkjfdslkjf2222• 4 years ago

With what? Dollars that are dipping 8% a year?

2Gkashmiri2• 4 years ago

interestingly US $ to indian rupee is growing more wider at around 77.8 INR to 1 US$. by that projection, indian rupee is falling so either invest in gold or US$ to beat "indian inflation"... does that make sense?

vmception4• 4 years ago

Yes exactly. You can handle inflation for 6 months to 2 years

onlyrealcuzzo2• 4 years ago

If the hypothesis is that home prices are going down - then dollars are not going down the same amount WRT house prices.

andrewmcwatters• 4 years ago

Interesting you mention this because the US equities market is dropping in value faster than the dollar is right now. :)

bluGill2• 4 years ago

Who knows? If you want predictions of the future you need to talk to a religious leader: they are the ones who deal in confident predictions of the unknowable future.

There are signs anyone can read about the future, but nobody really knows exactly what they mean or how it will work out. If house prices continue to increase, but at half the rate of inflation: get in now. If house prices go down then wait. Just to make this more difficult, where are you living now: unless you can continue to live rent free in your parent's basement (I'm sure someone reading this is actually doing that), then you need to consider the cost of rent while waiting: even if a house goes down in value, it may still be worthwhile as an investment because most of the payment is coming from rent. Then there is the cost of maintenance which might be significant. There is the cost of moving: if you rent you can break the contract and leave a lot faster than if you have to sell a house in a now bad location first.

If you think I covered even half of the considerations in a couple short paragraphs you are very naive.

adamsmith1432• 4 years ago

Time in the market beats timing the market. You almost certainly aren't going to buy back in at the right time.

ryanSrich2• 4 years ago

How are people with a subprime score even getting a loan? When I took out a mortgage in 2015 and then again in 2017 they scrutinized my entire life. I have no idea how we’ve regressed back to 2008 after years of very strict regulations.

tedd4u• 4 years ago

I think subprime just means you just get offered a higher mortgage rate. You still have all the documentation mandates. No more NINA or NINJA[1] loans.

[1] https://corporatefinanceinstitute.com/resources/knowledge/cr...

jrumbut• 4 years ago

The amounts that mortgage originators will hand out are still pretty incredible.

I bought a house a few months ago. The mortgage payment is right around what the more conservative rules of thumb suggest is affordable.

After the lender had all my information I asked, out of curiosity, what was the maximum they'd lend me. They came back with a number that was more than triple what I ended up borrowing and suggested there was room to go higher if that was something I was interested in.

Perhaps subprime borrowers face lower limits but it's still possible to take a risk stretching your budget to buy a house. That may be OK or even good but I'm concerned the perception is that lenders won't approve a mortgage that will be very difficult to keep up with when they absolutely will.

imtringued3• 4 years ago

I got 0% financing (first x months) on my kitchen. They checked absolutely nothing on a 5k€ purchase.

yardie3• 4 years ago

From the article: car loans, credit, and person loans (payday loans). Mortgages are highly regulated since 2008's financial crisis. Those subprime lenders exited the mortgage business and jumped into high interest used car loans. And I'm right there with you on the anal probing I had to practically get to qualify for a mortgage.

adrr• 4 years ago

Wondering if it is hitting the installment tech companies like Affirm and Afterpay.

pueblito• 4 years ago

Only 28% of sales are to first time buys, and 25% of sales are all-cash. Sales of affordable houses under $250k are down 30% YoY

nimbius2• 4 years ago

worth mentioning: the auto lending market in the US is a 1.6 trillion dollar time bomb and has been ever since Cash for Clunkers saw two rounds of federal funding.

the average period for an auto loan in the US is over 64 months. any disruption to the paycheck-to-paycheck living of 64% of americans could have a catastrophic effect on the ability to service this debt.

jimt1234• 4 years ago

Also, did the Trump Administration relax a bunch of regulations around predatory loans? I recall the auto and payday loan industries were very happy.

MAGZine• 4 years ago

Part of Dodd-Frank, which was created in response to the 2008 financial crisis, was repealed in 2018.

https://en.wikipedia.org/wiki/Economic_Growth,_Regulatory_Re...

vlozko• 4 years ago

I'm not sure how that's directly related to the issue of subprime borrowers but in my recollection this was a good change. It was a regulation that was costly and difficult for smaller banks to constantly adhere to while larger banks already had the capability to do this. Much like how the mortgage moratorium policy ended up forcing smaller landlords to sell to larger property holding companies, this particular bit of regulation was causing many smaller banks to sell themselves to larger ones.

bregma• 4 years ago

Because there is money to be made.

gernb• 4 years ago

If you want to be depressed, go to Los Angeles and tune into a radio station that caters to people living in poor neighborhoods. Every 3rd or 4th ad is for a loan shark.

giantg24• 4 years ago

The scrutiny may be higher, but the amounts they are approving people for is insane. Like who thinks it's a good idea to approve someone with an $80k income for a $450k mortgage?

scarface747• 4 years ago

I’m not aware of any mortgages that allow that debt to income ratio for a mortgage. Unless it’s a rental and then the down payment requirements are insane.

fshbbdssbbgdd2• 4 years ago

The relevant ratio for mortgage underwriting is monthly income to monthly payment obligations. This means that the highest available mortgage amount depends on the interest rate. You get a very different answer if rates are 2.5% instead of 5.0%. That means a person with $80k is getting approved for a much smaller loan today than six months ago.

Rules of thumb like “mortgage amount should be less than 3x income” don’t make much sense because they ignore the interest rate.

babypuncher2• 4 years ago

I was making $80k when I bought my house and was shocked when my bank told me I could buy a $450k home. I bought something for $260k instead.

carabiner• 4 years ago

Margin loans. They let you bypass mortgage borrower requirements and are behind many "cash offers" on houses. Borrow and spend $400k in 45 minutes: https://www.mrmoneymustache.com/2021/01/29/margin-loan-ibkr-....

Can't find a link to it, but someone on WSB wrote a long report on how margin loans will be behind the next housing crash.

tootie2• 4 years ago

I got denied a mortgage despite have assets in excess of the value of the house I wanted due to insufficient income (wasn't working at the time).

panda88888• 4 years ago

Did you provide the assets as collateral for the loan? I imagine a traditional mortgage may not have this as an option, but a different kind of loan may have been possible. However, you can probably only borrow up to a portion of the collateral value.

tcamp• 4 years ago

Same thing happened to me. I got denied because as a founder/owner holding more than 25% of a company they consider the P&L of the company as your personal income(loss).

Credit score impacts interest rate but debt to income ratio that is above 50% can completely disqualify you from a mortgage. Thats where the founder ownership can skew your personal DTI.

You can go to asset based lenders who evaluate and secure the loan against your existing assets (cash, etc) rather than based on your W2 income and DTI.

chubbyFIREthrwy• 4 years ago

Same, kinda. Wasn't denied, but would have to pay a huge risk premium over conventional, regardless of how much I put up as a down payment, like the home's collateral value didn't matter. Earlier post:

https://news.ycombinator.com/item?id=31000286

aaroninsf• 4 years ago

Comment on "ARMs did not cause the 2008 crash."

Absolutely true; the question about whether they may cause an imminent one is still a good question. Rhymes-not-echoes, etc.

Google cruft suggests that the number of ARMs was < 5% five years ago but has climbed recently, e.g.

https://www.nbcnews.com/business/business-news/adjustable-ra...

from April says: "The adjustable-rate mortgage share of applications last week was over 9 percent by loan count and 17 percent based on dollar volume."

I would welcome informed comment on what the total outstanding % of loans by count and total volume data looks like,

and in particular, insight as to whether the amounts are likely to trigger market disequilibrium...

bitwize• 4 years ago

Quasi-on-topic anecdote: Amazon used to (and may still) sell these DVD bundles, like 8-12 movies to a pack. There would be a few classics (Ghostbusters or something) mixed in with arrant garbage. The hope was you'd buy the pack for the classics and maybe watch the garbage later because you have it so why not.

I used to call this sales strategy "Amazon Subprime". I still think that's one of my cleverest jokes, but unfortunately you might only laugh if you know how the 2008 housing crisis actually started... and the people who do know that are not great in number.

yardie3• 4 years ago

Most people believe 2008 was caused by single mothers (as an example) "buying a home they couldn't afford." The reality is it was the upper-middle class, non finance professionals just thinking they were savvy. When your doctor, dentist, or general contractor gives you financial advice you should run the other way!

I see this playing out now with cryptocurrency. Suddenly, everyone is an expert on Bitcoin!

adamsmith1432• 4 years ago

The reality is it was the upper-middle class, non finance professionals just thinking they were savvy.

But also lots of highly educated Ivy League Finance folks who thought they were smarter than the were. Hence Bear Stearns, Lehman Brothers, AIG, Merill Lynch, etc.

bee_rider• 4 years ago

This fall into the class of pun that is both completely perfect, and also incredibly situational. If I have a pun like this, either the situation to use it will never come up, or if it does I will become too excited and flub the delivery.

Bravo getting this one out there.

Srikanth• 4 years ago

Thanks for sharing this anecdote. TIL: arrant = complete, utter.

scarface747• 4 years ago

Why is everyone talking about mortgages when the article talks about everything but mortgages?

Borrowers with limited or troubled credit histories are defaulting on credit cards, car loans and personal loans

wmeredith• 4 years ago

Because people see the word "subprime" and think of mortgages.

rco87862• 4 years ago

And because the person who wrote the headline is well aware of that fact.

drzoltar2• 4 years ago

Actually, I’m worried about techies specifically. It’s (was) surprisingly easy to count RSUs as income collateral, especially since the last 5 years have shown such a consistent source of income. Now that many RSUs are in the gutter, combined with an ARM, I don’t get how some techies will make ends meet especially in places like the Bay Area. Anyone know the actual magnitude of this problem though?

notyourwork2• 4 years ago

It’s surprisingly easy to count RSUs as income

This is irresponsible in my opinion. (I'm sure some disagree.) Personally, I took the conservative approach where during my home purchase we made sure our income could afford a mortgage. Our RSU's are a bonus and when they come we can pay down our mortgage faster, go on fun vacations, or do all sorts of other things.

Currently, I'm on pace to pay off my 30-year mortgage in 8-10 years by putting half of my RSU's towards my mortgage on top of the monthly payments.

arcticbull5• 4 years ago

Currently, I'm on pace to pay off my 30-year mortgage in 8-10 years by putting half of my RSU's towards my mortgage on top of the monthly payments.

This is not a great idea if you have a 30-year fixed mortgage with an APR below inflation. You're better off not paying it off, and instead setting aside the cash you would have used. Even in like a Series I bond which is currently paying 9% APR.

Money loses value every year, and it's losing value faster than your mortgage is going up in cost. Therefore, why would you pay it off today using money that's worth more, when you can pay it off in the future using money that's worth less?

Especially if you can park your money in something that tracks inflation.

Paying off your mortgage early is one of those things folks are always told is good - it's really not.

That's a free 9%+ return on capital. You're giving up free double-digit returns by paying off your mortgage early.

nkingsy• 4 years ago

I was explicitly told by a mortgage broker in January that RSU's don't count in income calculations.

Made the difference between me qualifying and not (for a 10% down jumbo, which was admittedly a stretch).

drzoltar2• 4 years ago

To clarify I’m not sure it counts directly to income, but it starts to be taken into account when there is substantial salary and other investment funds, especially if you are right on the border of the salary/loan ratio. Someone else mentioned it’s more like collateral

desmosxxx• 4 years ago

Probably depends on the broker and market. We bought in the bay area and RSU were counted as income (and fairly certain 1:1 by some lenders). And in some other areas they wont look at them at all is my understanding.

Androider• 4 years ago

For mortgages, lenders will entirely or heavily discount RSUs for income calculations.

However not discouraged by that fact, some tech folks are known to instead have taken out regular non-mortgage variable rate loans with their RSUs as collateral. So there are folks, who bought a house "all cash" with loans backed by stock collateral that is now worth much less. Those types of loans also have a double-digit APR, which might have been fine if you thought you could flip your house for 30-100% in the near future. In the current housing marking it is like putting everything on black at a casino, it might work out, but it might be also be a complete catastrophe.

arcticbull5• 4 years ago

Those types of loans also have a double-digit APR, which might have been fine if you tought you could flip your house for 30-100% in the near future.

Nah not all of them. Margin loans were as low as 0.5% APR, and currently not much higher than that.

JumpCrisscross3• 4 years ago

lenders will entirely or heavily discount RSUs for income calculations

Multiple lenders, when I was shopping for a mortgage in October, encouraged me to take a variable-rate ARM with a balloon payment when I mentioned my options. (I declined, opting for a 15-year standard instead.) For the lender, as long as you can refinance in 5 years, the risk is minimal. For a borrower, this structure could easily wipe out one's savings.

dhosek• 4 years ago

Those of us who’ve lived through more than a few years of working life value stock options and RSUs and anything else at zero until it’s transformed into cash.

whimsicalism• 4 years ago

well that's obviously nonsense

ActorNightly2• 4 years ago

Techies have zero excuse for any sort of financial trouble. Not only has the job market has been insane (and still is for the most part), the amount of money you make, even with previous RSU distributions should allow anyone in the field to save enough money to ride out a recession.

There is however a definite problem of people across all income levels living way above their means.

scarface747• 4 years ago

I’ve had to go through the mortgage process three times in the last two years when my income was based on a prorated two year signing bonus and a back heavy RSU vesting schedule over 4 years [1].

The first time for a refinance and the second time for HELOC. Both times they would only consider my base. Luckily I lived in a relatively low cost of living area and we weren’t talking about that much by todays standards - a $300K refinance and a $160K HELOC a so my base pay was enough.

The third time when I tried to get an investment property, my DTI was too high to qualify based on solely my base. If they had counted my RSU grants even considering the 30%+ YTD decline, it would have been more than enough. I ended up doing a no income documentation loan and paying down the loan by a point. I also had to put 30% down.

For the second one, they still questioned why my stated income for 2022 was much lower than my actual income for 2021. I had to re-explain my compensation structure.

[1] How do you say which BigTech company you work for without saying which BigTech company you work for.

sbarbarian2• 4 years ago

The subprime space is really interesting vs mortgages. Like others mention, the due diligence these providers run for these is minimal.

The business model has been so successful in recent years because there have been such large numbers of applicants. Even though they approve only a fraction, the sheer volume means their business is booming. This all translates into not having to dig any deeper than credit scores.

rco87862• 4 years ago

That doesn’t make any sense. You’re implying that they’re just lending to people with the best credit scores. Which definitioally makes these not subprime loans.

sbarbarian2• 4 years ago

Sorry, didn't mean to imply that. Its the best of the worst. You just lower the threshold to hit the volumes / default rate you're comfortable with to make a profit. Subprime is anything lower than 670, so you don't need to go so low.

wanda• 4 years ago

Article is essentially paywalled, I'm not in finance and I'm not well-informed (and by my own admission I don't go out of my way to be well-informed), so forgive me if these questions are covered or stupid, but my questions when reading the headline are:

1. Are these subprime loans packaged in CDOs or any other kind of highly-rated derivative instruments?

2. If so, how exposed are the banks this time? What are current leverage limits?

3. Are there swaps on these instruments, and if so, are these positions being taken by the banks that are selling the CDOs?

4. If so, how exposed are the insurance firms?

In short, are the conditions in place for a similar event to 07/08? Has any meaningful regulation been introduced that extends beyond the mortgage market?

Looking beyond conventional lending, what is the scale of cryptocurrency lending? As I understand it, there's not much in the way of regulation when it comes to cryptocurrency, and I feel like that's probably a recipe for disaster somewhere in the future.

labrador• 4 years ago

Loan sharks probably aren't getting paid back as much which could explain the rise in assault and murder rates, at least partly

Threeve303• 4 years ago

A perfect storm of economic and geopolitical conditions… May you live in interesting times indeed.

More Subprime Borrowers Are Missing Loan Payments

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