Mortgage Renegotiation

[sugarpop]

This is the reason why I said (somewhere) that I don't think mortgages should be traded. If you have to hold on to a mortgage, then you are more likely to make good, sound loans. I never even knew mortgages WERE traded until recently. Really, who came up that genius idea? that is the STUDIEST thing I've ever heard. Well, not really, but close.

[Beestie]

Originally Posted by sugarpop

This is the reason why I said (somewhere) that I don't think mortgages should be traded. If you have to hold on to a mortgage, then you are more likely to make good, sound loans. I never even knew mortgages WERE traded until recently. Really, who came up that genius idea? that is the STUPIDEST thing I've ever heard. Well, not really, but close.

Mortgages aren't really traded. A small number are but the vast majority are combined with other mortgages into mortgage securities. While its tempting to blame this idea for the economic downfall, it is precisely this idea (that has been around since the 1970s) that has allowed the vast majority of Americans to obtain affordable mortgages.

Its only the recent development of the uber high-risk stuff that is to partially blame for the economy. The underlying secondary mortgage market is really a thing of beauty and remarkable efficiency.