What is Sub-prime crisis?
In our earlier discussion on sub-prime mortgage, we acknowledged that both creditors and debtors carry high risk in such kind of lending. Sub-prime crisis is the result of those risks.
Sub-prime crisis is associated with the increase in foreclosures of the sub-prime mortgage borrowers. It was significant enough in the year 2006 to create headlines. In year 2007 the total value of the sub-prime mortgages was more than two trillion dollars, which makes about 15 % of the total mortgages. Due to the sub-prime mortgage market meltdown the houses of millions of Americans are under the risk of foreclosure. Over six hundred thousand of such foreclosures were initiated during the first half of 2007.
In our earlier discussion on sub-prime mortgage, we acknowledged that both creditors and debtors carry high risk in such kind of lending. Sub-prime crisis is the result of those risks.
Sub-prime crisis is associated with the increase in foreclosures of the sub-prime mortgage borrowers. It was significant enough in the year 2006 to create headlines. In year 2007 the total value of the sub-prime mortgages was more than two trillion dollars, which makes about 15 % of the total mortgages. Due to the sub-prime mortgage market meltdown the houses of millions of Americans are under the risk of foreclosure. Over six hundred thousand of such foreclosures were initiated during the first half of 2007.
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