The Value

In addition, enthusiasm plenty, decided to grant to hypothecating credits by a value superior to the value of the house that it bought ninja, because, with the mentioned real estate boom, that house, in few months, would be worth more than the amount given in loan. To this type of mortgages, mortgages called to them prevails i. Mortgages are called prioritizes those that have little risk of non-payment. In a scale of classification between 300 and 850 points, the mortgages prevail are evaluated between the 850 best points and the 620 less best ones. II. Mortgages are called prevails those that have more risk of non-payment and are valued between 620 the less good and 300, the bad ones.

In addition, as the American economy went very well, the indebted insolvent today could find a job and pay the debt without problems. This exposition was well during some years. In those years, ninja was paying the terms of the mortgage and, in addition, like they had given to more money del them than it was worth its house, they had bought a car, they had made reforms in the house and they had gone away of vacations with the family. All this, surely, on credit, with the money of more than had received and, in some case, and so some use or shoddy work paid to them in that had obtained. to 1er. commentary: I believe that, up to here, everything is very clear and also it is clear that any person with common sense, although is not a financial specialist, can think that, if something fails, the crash can be important. As far as second (increase of the number of operations): As the Banks were giving many hypothecating loans, the money finished to them. The solution was very easy: to go to foreign Banks so that they gave money to them, because for something it is the globalisation.