I believe almost all mortgages made in Canada are "recourse" yes? That is the fundamental reason there wasn't a housing meltdown in Canada. Simply doing the same here in the states would end the threat of a repeat and take bad actors in the mortgage origination process and ignorant consumers off the table.
I believe almost all mortgages made in Canada are "recourse" yes? That is the fundamental reason there wasn't a housing meltdown in Canada. Simply doing the same here in the states would end the threat of a repeat and take bad actors in the mortgage origination process and ignorant consumers off the table.
We do power of sale here- very few foreclosures. Our banking system is very very different than yours. Sorry-- former banking economist-- that's not why there wasn't a meltdown. We have very different holding percentage requirements for bank lending. Both OSFI and the federal Bank Act (banks are regulated by the federal government) have clear basic minimums. So the crap table lending and gambling you get in the US is not part of our system.
Remember your system is heavily private (including regulation)--ours is not-- if private banks want to operate in Canada they have very clear regulations they have to meet- then they get a piece of the pie . We used to have 5 big banks until 1980 when we let some international banks in HSBC, some American ones etc.
BTW I never brag just state the differences. Didnt say it was better, just said we didnt suffer-- I assume you live elsewhere but kept the Citizenship?
Hey Andrew. I was speaking why the 2008 US debacle didnt crash our banking system. Never mentioned the valuation of real estate. Agree-- over valued thanks to Chinese money-- everywhere- New Zealand, Australia, Paris, London etc. That reckoning will come no doubt. BUT it has nothing to do with banks-- it has to do with the standard economic canard-- " Too much money chasing too few goods" add into the money laundering aspects (husband is a fraud and banking lawyer) and voila! a perfect storm.
BTW your characterization of CMHC is incorrect-- our system from day one (we are a baby country after all ЁЯШК) was set up like this. Sorry-- Canadian eh?
┬лalmost all mortgages made in Canada are "recourse" yes? That is the fundamental reason there wasn't a housing meltdown in Canada. Simply doing the same here in the states would end the threat of a repeat┬╗
All mortgages in the UK or Ireland (or Spain etc.) are "recourse" and there was a meltdown. What happened in the UK: the government ordered the mortgage lenders to avoid "recourse" because it was politically unacceptable, the speculative middle class would not accept mass repossesions. Some years after the 2008-2009 crash the BoE published a survey showing that 14% of all mortgages were still in "forbearance", and this caused quite a storm, so they stopped publishing such data.
тАЬThe Bank of England estimates that as much as 14% of all UK home loans are either delinquent or in some sort of forbearance process. Nobody really talks about this because nobody wants property prices to fall out of bed. Can we handle the truth?тАЭ
As in many other cases "recourse" is something that can only happen to a few middle class people, and then their neighbours think "losers", but it cannot happen to many middle class people because then they vote against it at election time. Individually the middle classes are powerless, but collectively they can swing elections, so they are powerful.
Cal, Tx and AZ are the biggest obviously and comprise a significant percentage of underlying loans in most MBS products. You might look up the HARP program that was created in 09 but expired in 18. That program I believe was the one that allowed short sales of properties with no further recourse to borrowers but not positive
I believe almost all mortgages made in Canada are "recourse" yes? That is the fundamental reason there wasn't a housing meltdown in Canada. Simply doing the same here in the states would end the threat of a repeat and take bad actors in the mortgage origination process and ignorant consumers off the table.
We do power of sale here- very few foreclosures. Our banking system is very very different than yours. Sorry-- former banking economist-- that's not why there wasn't a meltdown. We have very different holding percentage requirements for bank lending. Both OSFI and the federal Bank Act (banks are regulated by the federal government) have clear basic minimums. So the crap table lending and gambling you get in the US is not part of our system.
Remember your system is heavily private (including regulation)--ours is not-- if private banks want to operate in Canada they have very clear regulations they have to meet- then they get a piece of the pie . We used to have 5 big banks until 1980 when we let some international banks in HSBC, some American ones etc.
Sorry one other thing-- most Cdns have 10 yr mortgages-- my RBC banking friend's info
BTW I never brag just state the differences. Didnt say it was better, just said we didnt suffer-- I assume you live elsewhere but kept the Citizenship?
Hey Andrew. I was speaking why the 2008 US debacle didnt crash our banking system. Never mentioned the valuation of real estate. Agree-- over valued thanks to Chinese money-- everywhere- New Zealand, Australia, Paris, London etc. That reckoning will come no doubt. BUT it has nothing to do with banks-- it has to do with the standard economic canard-- " Too much money chasing too few goods" add into the money laundering aspects (husband is a fraud and banking lawyer) and voila! a perfect storm.
BTW your characterization of CMHC is incorrect-- our system from day one (we are a baby country after all ЁЯШК) was set up like this. Sorry-- Canadian eh?
┬лalmost all mortgages made in Canada are "recourse" yes? That is the fundamental reason there wasn't a housing meltdown in Canada. Simply doing the same here in the states would end the threat of a repeat┬╗
All mortgages in the UK or Ireland (or Spain etc.) are "recourse" and there was a meltdown. What happened in the UK: the government ordered the mortgage lenders to avoid "recourse" because it was politically unacceptable, the speculative middle class would not accept mass repossesions. Some years after the 2008-2009 crash the BoE published a survey showing that 14% of all mortgages were still in "forbearance", and this caused quite a storm, so they stopped publishing such data.
http://pragcap.com/you-cant-handle-the-truth-2
тАЬThe Bank of England estimates that as much as 14% of all UK home loans are either delinquent or in some sort of forbearance process. Nobody really talks about this because nobody wants property prices to fall out of bed. Can we handle the truth?тАЭ
As in many other cases "recourse" is something that can only happen to a few middle class people, and then their neighbours think "losers", but it cannot happen to many middle class people because then they vote against it at election time. Individually the middle classes are powerless, but collectively they can swing elections, so they are powerful.
All Home mortgages in the US are personal recourse, secured by the home, but liable for any shortfall upon sale
Here are the 12 states where mortgages are non recourse: https://www.forbes.com/advisor/loans/recourse-loans-vs-non-recourse-loans/#:~:text=Home%20mortgages%E2%80%94though%20generally%20recourse%E2%80%94are%20non-recourse%20in%2012%20states%3A,Carolina%2C%20North%20Dakota%2C%20Oregon%2C%20Texas%2C%20Utah%20and%20Washington. Home mortgagesтАФthough generally recourseтАФare non-recourse in 12 states: Alaska, Arizona, California, Connecticut, Idaho, Minnesota, North Carolina, North Dakota, Oregon, Texas, Utah and Washington. If a homeowner defaults in one of these states, the lender can foreclose on the collateralized home but cannot go after the borrowerтАЩs other assets.
Cal, Tx and AZ are the biggest obviously and comprise a significant percentage of underlying loans in most MBS products. You might look up the HARP program that was created in 09 but expired in 18. That program I believe was the one that allowed short sales of properties with no further recourse to borrowers but not positive