Even More Loan Failures
Posted By: Dr. Frugal in Loans on 10/22/2007 at 05:23:33
According to the Financial Times, the loan problems in the US continue to expand outward. First it was home foreclosures and now it has infected credit cards and auto loans.
Banks are adding to reserves not just for defaults on mortgages, but also on home equity loans, car loans and credit cards.
Well duh. If the primary asset of people is their home and they're losing that--well, they're naturally going to be on the verge of losing everything else. Duh. With the ubiquitousness of home equity loans used to pay for things like credit cards and auto loans it should come as absolutely no surprise that without the backbone of equity the things dependent upon it are going to fail too.
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