[Getting Graphic] Quality Is Not Job1: Why Home Mortgage Underwriting Is So Strict
Posted by Jonathan J. Miller -Monday, June 1, 2009, 11:23 AM
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Getting Graphic is a semi-sort-of-irregular collection of our favorite BIG real estate-related chart(s).
Click here for full sized graphic.
It’s 2 out of 3: GM joins Chrysler on the bankruptcy production line, so my take on Ford’s advertising slogan seems relevant.
Bank and automakers’ similarities end with GM and Citigroup being removed from the Dow Jones Industrial Average today.
Automakers WANT to sell cars.
Banks DO NOT WANT to make loans.
Here’s a compelling reason for banks’ recent need for self-preservation.
In Floyd Norris’ column this weekend titled Troubled Bank Loans Hit a Record High
OVERALL loan quality at American banks is the worst in at least a quarter century, and the quality of loans is deteriorating at the fastest pace ever, according to statistics released this week by the Federal Deposit Insurance Corporation.
Bank underwriting is notoriously difficult right now and who can blame them? They have to make loans in an economic environment where:
- Housing prices are declining
- Mortgage defaults are rising
- Unemployment is rising
Banks are in survival mode at the moment.
