Upside Down Mortgage

Posts Tagged ‘business’

Subprime Derivatives

Question: Hedge fund made 1,000% return on subprime, news just out today, they made 20Bill, how they do that?

he decision to use derivatives to short, or bet against, low-quality US home loans taken by a select group of hedge funds last year appears to have become the most profitable single trade of all time, making well over $20bn in total so far this year. I want to konw what kind of derivatives product they use and how excatly they do it?

http://www.isegoria.net/2007/11/1000-hedge-fund-wins-subprime-bet.htm

Answer: I don't know if this was the same hedge fund, but take a look at this article:

http://articles.moneycentral.msn.com/Commentary/Experts/Markman/Jon_Markman.aspx?msn=1

It gives a pretty good explanation of how they did this.

2008 vs 1929 - The Real Truth

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Subprime Risk

Question: How do you know whether the bank classes your home loan as a "subprime" loan?

My loan is fixed rate, my monthly payment is fairly low, and I put down a large downpayment. But it was my first home, and I find myself wondering if I had a "bad risk" loan or a normal home loan, after hearing constant talk about "the subprime lending debacle". Any info you can offer will be appreciated.

Answer: If you put a substantial down payment and have decent credit then chances are real good that you are not in a sub prime loan as these loans are typically out of the ordinary type loans such as no-doc, stated income or even 100% financing which I don't even think you can get anymore. When in doubt call your lender and ask.

Mortgage Survey March 2008

Subprime Fraud

Question: Did God stop blessing America when bush took office 7 years ago? Since then, many plagues have been visited...

upon our nation, including 9/11, Hurricane Katrina, and the disaster of bush's war in Iraq. We have suffered one wave of corporate fraud, inflicted upon us by the likes of Enron, WorldCom, and Arthur Anderson. Today, we are being bankrupted by a 2nd wave of corporate fraud, brought to us by Bear Stearns and other greedy investment banks with their subprime lending schemes. Now, bush's 7-year recession threatens to plunge into a full-blown depression in his last year. The US dollar is crashing faster than America's respect and credibility around the world, while bush squanders everything that generations of Americans have worked so hard to build since the end of World War II.

It's like America has lost its place in the world since bush took office. Is God punishing us because of the republicans? Did God stop blessing America when it allowed bush to be installed as the nation's first illegitimate president?

Answer: What an awesome hypothesis...God is angry with us because of Dubya...I bet Pat Robertson wont be preaching that one.

Awesome...just awesome.

Stop the Bailouts