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The sub prime mortgage crash isn’t over. Sure the actual crash is over, but the effects of it are going to be felt for several years still. While that’s common for all kinds of sector crashes, the thing that’s different here are the lenders and borrowers.
After the dot com crash, it was hard to get money for Internet based/related businesses. It was still possible, just ask Google, but it was very difficult. You had to essentially be a sure thing since no one was willing to put themselves at risk anymore.
The same thing will happen again except that instead of being businesses who can’t get their hands on money, it’s going to be people having a hard time getting mortgage loans. Similarly, people who are refinancing their mortgages or other loan are going to face a similar challenge.
The real downside is that there’s essentially no way out. This is just the reality that US home owners are facing. The one thing that you can do to put yourself in the best position to work within this new system though is to take care of your credit score. No longer will loans be given out as freely to people with bad credit. A good credit score is going to be a requirement once again should you wish to borrow enough money to buy a home.
So the bad news is, there’s no avoiding the problems to come. The good news is that making it as painless as possible is within your control.
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