VIKAS BAJAJ of the NY Times says:
Little by little, millions of Americans surrendered equity in their homes in recent ears. Lulled by good times, they borrowed — sometimes heavily — against the roofs over their heads. Now the bill is coming due. As the housing market spirals onward, home equity loans, which turn home sweet home into cash sweet cash, are becoming the next flash point in the mortgage crisis. Americans owe a staggering $1.1 trillion on home equity loans — and banks are increasingly worried they may not get some of that money back.
It is a remarkable turnabout for the many Americans who have come to regard a home as an A.T.M. with three bedrooms and 1.5 baths. When times were good, they borrowed against their homes to pay for all sorts of things, from new cars to college educations to a home theater. Lenders also encouraged many aspiring homeowners to take out not one but two mortgages simultaneously — ordinary ones plus “piggyback” loans — to avoid putting any cash down.
I think someone's been reading this and other blogs. About damn time you lazy reporters in the MSM clued in to this. I and other have been saying this for years.
I love the line 'banks are increasingly worried'. Uhm you mean the same banks who can't get the deadbeat slackers to pay their 1st mortgage are surprised that the deadbeats can't and won't pay back the 2nd?
But fear not, I'm sure as I type this a politician is coming up with a solution to the...cue scary music...crisis. Everything is a crisis these days. Gas crisis. Mortgage crisis. Health care crisis. Education crisis. American Idol voted off Chekeezii Weezie crisis.
And what's this? Americans owe a "staggering" $1.1T? Why is that so staggering Vikas? The federal gubermint owes $10T. Jorge W. along with his good pal Alan Greenspan encouraged anyone with a pulse to borrow as much as they could to fund the 'American Dream' of home ownership. I'm surprised it's only $1.1T myself. Compared to the recklessness of the US government, American home"owners" have behaved quite responsibly.
And Vikas, what in the world do you mean the housing crash is spiralling downward? I read just this week that realtors are saying all is well and we should all go out and buy a house. Many expert economists are saying the same thing. So either you are wrong and the housing market is fine, in which case we don't need a bailout and all this mortgage crisis business will go away on its own. Or the so-called experts are lying through their teeth and the worst is yet to come.
I know I am asking a lot of an MSM reporter to digest Vikas. I am asking for analysis in your writing and not merely a regurgitation of the last press release.