In the US, reviving the credit markets requires stopping the mortgage defaults driven by negative equity.

This creates a strong incentive to default, because mortgages in the US are effectively non recourse loans the creditor may take the property if the borrower doesn t pay, but cannot take other assets or a portion of wage income.

German banks grant mortgages only to a maximum of 60 of the value of a house, instead of the 100 mortgages that were frequently seen in the US and United Kingdom.

Negative equity is significant because mortgages in the United States are generally no recourse loans.

Moreover, real estate prices might fall dramatically, in which case many households may find the value of their mortgage exceeding the value of their house.

When housing prices fell, so did the value of the mortgages and the securities based upon them.

For one out of four US mortgages, the debt exceeds the home s value.

Given the large number of negative equity homeowners, there is a risk that defaults and foreclosures will continue.

Oh yes. The mortgage.

In the last years before the crisis, the flow of new mortgages had been 60 higher than the value of residential construction.

With mortgages amounting to 95 or more of the value of the house, debt restructuring will not be easy.

Give me the pawn ticket.

In the last years before the crisis, the flow of new mortgages had been 60 higher than the value of residential construction. Now it is 150 lower.

But, between the sub prime US mortgage crisis and the dollar s ongoing decline, America s exorbitant privilege now looks a bit shaky.

Third, we could adopt an alternative approach that directly reduces the value of underwater mortgages.

Then we'll get the mortgage.

It was lost on a mortgage. That must have been what happened.

The housing recession the worst in US history and worsening every day will eventually see house prices fall by more than 20 , with millions of Americans losing their homes.

The Right Weights for Mortgage Risks

Occupy the Mortgage Lenders

Paying down debt on credit cards or mortgages also counts as saving but increases in the value of existing assets like stocks or real estate do not, even though they increase the value of household wealth.

With one out of four mortgages in the US under water more owed than the house is worth there is a growing consensus that the only way to deal with the mess is to write down the value of the principal (what is owed).

So far, the sub prime crisis has had a limited direct impact on Latin America s mortgage markets.

what shall I do? If only he didn't have that mortgage.

Losses are spreading from sub prime to near prime and prime mortgages, commercial mortgages, and unsecured consumer credit (credit cards, auto loans, student loans).

First, housing can be made more affordable for poor and middle income Americans by converting the mortgage deduction into a cashable tax credit.

Mortgage debts, too, must be written down.

So they've created deductions, subsidies and insurances.

Let's say it's um let's say its 10 billion of commercial mortgages.

I have a whole video on mortgage backed securities.

As a result, one third of all American homeowners with mortgages are already underwater their mortgage debt exceeds the value of the house.

Mortgages became more widely available.

Mortgage brokers were happy to get in on the act.

It was called securitized mortgages.

Credit card, electronic wallets, mortgage back security stock options.

After the subprime crisis erupted, mortgage and consumer debt was paid down by households either with their savings or by default.

Unlike virtually every other country, US residential mortgages are effectively no recourse loans.

Indeed, the foreclosure rate is increasing.

The problem was not just sub prime mortgages.

The claimant sought from the Court an order of foreclosure.

Aren't you gonna ask him about the money for the mortgage?

This is B prime, this is A prime, this is C prime.

The value of freedom. It's a value of community.

Shows value selection dialog. Returns entered value.

What value does it have? It has no value.