HOUSINGNEWS REPORT
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The Return of Risk: Subprime Sneaking Back
BY PETER G. MILLER, STAFF WRITER
Subprime financing is on the upswing, and for a lot of people that’s a problem. The mortgage meltdown is widely identified with subprime lending so why should the return of such loans be welcomed? “Riskier U.S. mortgages are creeping back into the bond market again,” reported Bloomberg in May. “The
loans in question are nowhere near the toxic mortgages that brought down the financial system last decade. But they’re being made to people with lower credit scores and with more debt relative to their income.” Average wage earners purchasing a home at the U.S. median sales price of $245,000 in Q2 2018 would
need to spend 31.2 percent of gross income on the monthly house payment for that home — assuming 3 percent down and including mortgage, property taxes, and insurance, according to the ATTOM Data Solutions Q2 2018 U.S. Home Affordability Report.
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JULY 2018 | ATTOM DATA SOLUTIONS
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