Mortgage Report Rattles Markets
By David Cho and Dina ElBoghdady
Washington Post Staff Writers
Wednesday, March 14, 2007; A01
A national survey showing that a soaring number of homeowners failed to make their mortgage payments in the last quarter of 2006 rattled lawmakers in Washington and the markets in New York yesterday, as the Dow Jones industrial average plummeted 2 percent, or nearly 243 points.
The report, which sent every major stock market indicator tumbling when it was released at noon, revealed that the problems in the market for "subprime" mortgages -- loans made to home buyers with blemished credit histories -- might be spilling over to the broader mortgage industry, analysts said.
While the number of risky borrowers who missed payments climbed to a four-year high, the number of foreclosures on all homes jumped to its highest level in nearly four decades, according to the survey by the Mortgage Bankers Association. Home buyers who relied on loans insured by the Federal Housing Administration also had record default rates.Rest of the article here.
Is this the end of the middle class? Or a result of too many people willing to give it all up financially for a shot at the American dream?
Spending beyond ones means has become popular lately with the attitude of instant gratification and deserved riches without working to earn them.
Living beyond ones means, guarantees a rough financial ride that you and I will have to make up for in lost 401K funds. Once again the few spoil it for the many.
Grade school retribution continues.