9.47% of all residential mortgages are delinquent. Another 4.58% are in foreclosure. That's over 14% of all residential real estate in distress right now.
Add in two more bad players: 1) The coming option ARM meltdown, and 2) The Fed no longer buying mortgage backed securities as of this month, which subtracts $70 billion a month of capital from the mortgage industry. Capital that will be difficult to find elsewhere at such low rates, due to the risk.
As always, to understand what happened you simply follow the money. The powers that be used borrowed, taxed and printed money to prop up the real estate market. Who benefits? Only the government and the bankers, who just charged US to shore up THEIR assets. What we got is sky high debt, a dysfunctional economy and an unnecessarily high cost of living - all to keep the banksters solvent. As a bonus, we look into a highly insecure future in which collapse is more - far more - plausible than recovery.
This whole mess should have been allowed to crash. That would have been painful, but a real recovery would be well underway by now. We had the choice: a brief sharp pain, felt mostly by the bankers, or... ...intergenerational suffering for us, while the bankers cash more bonus checks!
What suckers we've been.