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Week of Nov. 17th-Mortgage Meltdown Unlikely Despite Hike in Risky Loans

November 17, 2019

Housing analysts are hoping it’s not a case of déjà vu. Unconventional mortgage lending is on the rise, in 2018 reaching its highest level since the financial crisis of 2008. These mortgages include subprime loans, financing offered to borrowers with blemished credits.

While these more risky loans are on the rise, some economists shrug off the notion that the economy is headed for another mortgage meltdown.

Despite the uptick in these types of loans, the number of unconventional mortgages is still less than 3% of loans made in 2018. In 2006, for comparison, unconventional mortgages made up 39% of the market. Negative amortization lending, in which the balances on the loan grow, have generally vanished from the market.  Read more



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