Q: Part of the subprime mess was the insistence of congress that a certain percentage of home loan go to basically underqualified applicants.. NINJA laws , etc So now that we ALL get to bail out this mess. I wonder how many of these poor folk are still in a home? anyone have any figures? Was it worth the gamble?
A: Out of all mortgage loans in the United States, 98% are being paid on time. The remaining 2% are in foreclosure. Out of those in forclosure, half (1% of the whole) are actually being forclosed on, the remainder will settle and the loan payments will continue. Out of the 1% that are failing, most of them are probably "sub-prime" or ARM loans. (Do you remember anyone in the past year or so putting out the alarming news that forclosures in America were up 60% or more? They almost always failed to tell listeners that foreclosures went up from 1.2% to 1.8% of all loans. I rounded up to 2%.)