SubPrime Mortgage Mess Explained (with voice)

[alamc200]

7 people still didn't get it..

[cuiyan2222]

LOL

[jabariabramson]

Freaking perfect. Great video, I wish this was playing all over the U.S.

[wildnites558]

Perfecto! The best and most accurately concise (and not to mention -- politically incorrect) explanation of the '08 financial meltdown i've ever seen.

[calcularhipoteca]

could happen again?

[sha370z]

2009 was the aftershock

[iFullMetalJacket]

The banks, investment banks, rating agency's, in this video- can you give me example of specifically what institutions that were doing this?

[diodoro73]

Thanx for posting TFF!!! this made plain what i had to read 3 chapters in my Economics book to understand. I hear people d=say that Obama's Reform Act is a joke and that it brings not real transparency to the books nowadays...

[sha370z]

this stuff when on for so long

[tiki2188]

Great video but it leaves out Congress plus 2 Presidents agreed on pushing the idea "everyone should have a house, even if they cant really afford it" so the whole thing got started. So this kind of seems biased by making it look like the mass public just said "yeah i want a house but go no money can i still has one?"

Sure, those who bought massive houses even being told it was all good should've thought "this isnt right" but lets be realistic. Root of the whole problem. MONEY. GREED.

[ssmusic214]

@tiki2188 "everyone should have a house, even if they cant really afford it" Official name for it was "Communities re-investment act".

[iFullMetalJacket]

@tiki2188 I think it had more to do with shadow banking (non-depository independent banks) that largely took hold in the late 90's and by 2008 had almost equalled the liquidity of regular commercial banks. But you are right, the CRA did encourage banks to loan to risky people.

[MrJamylephillips]

Great video!!!

[anilajax]

this is pretty good though, it does not explain what i was looking for.

[orangeman506]

Soon the banks won't be to big to fail they will be to big to bail out god the system is fucked up (I'm 11)

[SnowmanBeatz]

@orangeman506 congratulations on being 11...

[darkbluemta]

"fuck uuuuu....... fuck you!...."

[Newswire4]

Jim McCarthy a

[RyanADillon]

This is pretty good, but investment banks didn't keep the high interest rate (called junior) tranche on their balance sheets, in fact the reverse was true. They kept super-senior as it returned the smallest interest rate and was thus hardest to sell due to confidence in the housing market prices rising and even the junior tranche was given good credit ratings.

[CytherLynx]

it wasnt so much the sub-prime... but the AR mortgages. these were infact worse and made the bulk of the crap

[AdrielC877]

most annoying voice ever, stopped the video after 20 secs

[spectrum0590]

This is indeed a funny video. However it's deliver a good insight on how real estate broker makes a deal.

[rafasupertramp]

That's great, i just laughed my ass off... this is the very best and simplest explanation about this whole crap ever... cheers mates!

[ifginc]

Get easy home mortgage from IFG,Inc and live life in peace and happiness in your very own house.

[MortgageVoice]

It's funny how they blame the mortgage brokers while the banks set all the rules for the mortgages being funded. PLACE THE BLAME WHERE IT BELONGS THE BANKS!

[spriggangt]

@MortgageVoice lol ok your right we should.  The willingly ignorant at best or knowingly unscrupulous at worst, the brokers, the banks and the government. All players involved either knew or should have known that they move the move they were making was a bad one.

[vvmjrc]

@MortgageVoice The Banks??? Try Wall street they called the shots we put out the products with their guidelines... So yeah you are right the banks and wall street ran us like puppets and we get blamed.

[LakeRafiD]

Yup, this here is right on the money. LOL!!!!!

[sendu107]

hhaha great video man!

[sergioapuzzo]

i looove

this video!!

hilarious

[spacehog2001]

An economics student explained this to me while giving me a break at work two years ago. I couldn't remember what he said about spv's, and now it's clear. Thanks.

[ignati123]

The problem was caused when Fanny Mae and Freddy Mac bought up tons of the bad debt. This created and nurtured the paradigm of subprime lending. Liberal groups pressured banks to give risky loans to the poor too. Then, just prior to the 08' election, there was a "coincidental" run on FM&FM bonds. The resulting losses from bondholders triggered the financial crisis. Thanks to this, liberals have caused their candidate to get elected, and have blamed capitalism.

[nutblast23]

@ignati123 Oh, come dude, you really think that liberals have the power to tell businesses how to invest their loans? Get real.

[seoc3po]

Remember; FannieMae MANDATED that loans be given out to people who wouldn't otherwise qualify under standard industry guidelines. All in the name of "home ownership for everyone". If a lender refused to give a loan to someone who qualified under the new, very loosened guidelines, that lender could be sued for discrimination. The lender wasn't the problem, it was FannieMae who required these loans and the home buyer who didn't read and understand the biggest contract of their lives.

[b1gr1g]

Haha I loved the video- funny and educational! "Yea, just say you fucked up".

[italia4356]

Really funny video. But what happened to the Federal Reserve, FDIC, Fanny & Freddie Mac, Dot com bubble, Moral Hazard?

[Brantoc]

People want to change healthcare, or tax banks, or whatever, but

HAS ANYONE PROPOSED ABOLISHING THE MORTGAGE BACKED SECURITIES MESS? no.

Whiskey Tango Foxtrot

[bill127234]

Add in illegals buying houses and kaboom.

It all started with CRA 1977 and Jimmy Carter.

[aldezmail]

i get it now!!

[aikido7]

More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions.

Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year.

Only one of the top 25 subprime lenders in 2006 was directly subject to the housing law that's being lambasted by conservative critics.

Fannie Mae & Freddie Mac? Uh, no. ACORN? Uh, nope again.

Try George Bush, Phil Gramm and all the values voters.

[RichFoe]

That mortgages are realy smelly.

[bluenose1006]

Yes as a broker in the UK i agree were all in a mess.

[MrMortgage1]

nice

[MrMortgage1]

mortgageartist. com

Your path to the best mortgage information resource around.

Educating yourself costs you nothing, ignorance can cost you everything.

[gabrieldenis]

Nice

[quikesanjur]

really good one

[clairehsu2008]

Not only mortgages, student loan is also crazy...many Asian countries' college loan is only lower than 2% fixed for life...sigh!!

[JavelinMusic]

interesting!

[porcelinnadoll]

the dumb 'helium ballon' voices are VERY distracting. Ugh

[November302008]

We need 30 year fixed rate mortgages to be 2.5 % or lower.

[FWEEPSTAR99]

CRA loans default at a lower rate than others.

Over half of the people that received sub-prime mortgages qualified for prime rate mortgages. There was strong pressure by lenders to to get people into the sub-prime mortgages.

The people taking out ARM mortgages never intended to pay them off or even live in the house. They were skeezy people with money to burn who intended to buy property and flip it as soon as the value of the home rose through market value that was ballooning unrealistically.

[EasyEs]

Sorry no one knows how well the CRA loans performed on an individual basis. The study the treasury department put out about that said that in bundled securities they thought that CRA loans performed just as well as the other loans in the bundle because they had no way to tell otherwise.

In my opinion with the threat of government action and litigation every time you refuse a loan you'll just start handing them out all the time.

[jkratz930]

this is a great video. i actually learned what this dumb thing was about.

[bcmalloy]

What I don't understand is people who received these loans are not automatically refinanced by law as they were clearly mislead and defrauded by those selling a product dressed up as a loan to buy a house they could one day own when in fact they could never own the property they bought with one of these loans? why are the people who defrauded the public not held accountable for their actions ?

[shroomduke]

very good question!

it seems to me that there was a novice getting a loan and a PROFESSIONAL selling the loan, yet so many want to blame the little old lady that was just trying to make a living!

[stuntmasta305]

Why don't you mention the CRA, you don't blame the government for this dilemma.

[dave87gn]

YUP!

[JohnStumpfWF]

Thank you for your explanation - I wish I had known this years ago!

[mannyfeseha]

thehelpfund.blogspot

[jleve1974]

the truth of the matter is that banks [especially the fed reserve bank] rule the world so in other words, the people who own these banks enslave every person in the world by providing them credit they can't pay an essentially make us Owe them for the rest of our living days. If people were smart enough to realize this and not so caught up with politics, religion and every other man made bullshit that was created to control the masses, the rich would not exist because of revolt.

[SoberInsanity]

Well, our government had its role in encouraging banks to give our mortgages to people who couldnt afford them. Fannie Mae and Freddie Mac were formed as socialist tools to allow everyone in the U.S. to own a home, even if they couldnt afford it. These hybrid corporations promised to buy many of the loans, and since they were backed by the U.S. government, there was no risk right? Man, our government sucks.

[SerialPwner]

i think they should all be displayed in cages in all the capital cities of the world, like was the custom in the middle ages, baghdad should get bush, london the treasury minister and so on...

[SerialPwner]

today, thursday the 13 novermber 2009, there has been a meeting called in the USA for the 5 top hedgefonds people in the country, ever wondered were money from the sellout of the worthless papers went to? these 5 men earn over a billion dollars a year (officially) and ofcourse people have to be cut in from the government, judjes possibly and a load of others....... get what im saying?

well, anyone who killed any of the 5 men or anyone else involved would be a hero,

[prana888]

LOL

[capricornbloke]

US subprime collapse bill estimated at £472 billion The collapse of the subprime mortgage market in the US will cost the world economy

former chief economist of the World Bank and winner of the Nobel Prize in Economics, has stated the total costs of the Iraq War on the US economy will be three trillion dollars when counting the huge interest costs because combat is being financed with borrowed money

[armcrash]

EPIC! So close to the truth...

[BoShnb]

use the ISLAMIC rules & u will get rid of all this mortgage thing. i tried to understand what are mortgage benefits to poor people, community, government, the whole country ... but i couldn't find even one good thing about it.

[varoon5]

they fucked up, but no ones fucking up that bad.

[betrayer006]

the bible says the same stuff about debt so there is nothing special about your koran

[fANTASypuNK]

sion

YOU ASS. wtf man wtf.

SION..... o_0

[thegodofrice]

lol my econ teacher at Columbia tried to teach us this in two lectures(3 hours) and I've learned more from this video than he ever taught me

that's pretty smart on these banker's parts

get a crap load of easy shitty mortgages and then sell them out so they take no risk but bask in instant rewards...

[shoexy]

hahahaha. COOL

[masouid]

Great illustrations, thanks.

This is the most serious fraud in the history. Too bad no one is held responsible for this scam yet!

[Thycid]

who is to blame?

[prana888]

the banks who created those sneaky and "safe" investment products.

[voytechs]

Well you touched just the tip of the iceberg with this funny as hell video but its a good start. Remember F&D created this moral hazard and the fed pumped so much cheap credit (that's why values always go up philosophy).

Excellent!

[ugsdad]

Excellent explanation, Only thing missing is identifying 1999 relaxation of rules that opened the door for this abuse. What happened to accountability?? The thugs who reaped the profits and destroyed peoples lives should be held liable!!

[Julietjeske]

Much better with the audio, the other was really hard to follow. Nice and simple. My husband and I almost bought but I remember when I read about ARM I thought it was the craziest idea and I refused to do anything but a 30 yr. fixed rate. We didn't end up buying, thankfully.

[mustardsucks]

this country is going to fall. time to plant my garden in my backyard. I guess I can plant in my neighbor's yard too since nobody lives there anymore, and in his neighbor's yard also.

[mreimold]

great stuff! thanks for simplifying

[sxmadrid]

Excellent! Treat yourself to something nice.

[aghjsdf]

hahahahaha, thanks for simplifying things

[usersimdave]

much better with just music