Is 2021 Forbearance a Preview of 2008-Like Crisis?
2008 created a significant crisis in housing, bond markets, employment, and interest rates. Unemployment presents a significant problem. Interest rates are rising, but only for longer term loans such as mortgages. In a replay of 2008, short term interest rates (US treasuries with a term of 3 months, 6 months or 1 year) are actually at historic lows! March 22, 2021 sales by the US treasury put these rates well below 1/10th of 1%, from .015% to .06% (that’s less than 60 cents of interest for 1 year on $1000). Borrowers can’t pay more than 2.5 million mortgages at present. Serious delinquency rates for some programs exceed levels from 2008. Find out why this isn’t the 2008 crisis all over again. Want to know more? Let us know in a comment or question.