Credit Suisse - 12.7% of All Borrowers Will Be Foreclosed Upon

This little ditty below is one of the most aggressive foreclosure projections to date out of a large-named bank. Funny thing is, it goes hand-in-hand with my Subprime/ALT-A video in which I illustrate the overwhelming similarities between the two universes. YouTube Link... MR MORTGAGE - FUTURE ALT-A CRISIS EXPOSED . For the record, I think they are being conservative but '12.7% of all residential borrowers losing their homes' is quite a thought. -Best, Mr Mortgage

From Reuters: Foreclosures to affect 6.5 mln loans by 2012-report

Falling U.S. home prices and a lack of available credit may result in foreclosures on 6.5 million loans by the end of 2012. The foreclosures could put 12.7 percent of all residential borrowers out of their homes .

Credit Suisse expects home prices will fall by 10 percent in 2008 and 5 percent in 2009, before rebounding. The forecast includes the 1.2 million homes currently in foreclosure or already bank Real Estate Owned (REO). Credit Suisse sees 2008 as the peak year for foreclosures, even though they see the price bottom (25% off the peak) in 2009. The normal pattern is for the foreclosure activity to peak in the same year as housing prices bottom.

Of the 1.2 million current foreclosures, Credit Suisse estimates about half are due to subprime borrowers, and about half other borrowers (alt-A, prime). Although Credit Suisse expects a much higher percentage of subprime borrowers in foreclosure, the pool of other borrowers is much larger, and Credit Suisse expects close to 4 million other borrowers to lose their homes to foreclosure through 2012.

http://www.reuters.com/article/bondsNews/idUSN2233380820080422

Comments

[Darkest Before Dawn]

The think what companies will start doing is writing down their Federal Reserve Notes. A "worthless" security if there ever was one.

[NOR]

somehow the youtubelink does not work..

best regards

[Alex]

Mark -

Thanks for all of your YouTube videos and the blog. Finally, someone who knos what he is talking about in terms of mortgage and real estate. All of this is invaluable data that I wish more people would pay attention to.

DataQuick is a great resource and have been going there for years.

Please.... more videos, more information. Thanks!

[rigger]

have to agree on the videos,they're succinct informative and most importnatly shed light where there is dark.