The Canada Mortgage and Housing Corporation (CMHC), a governmental entity, has been buying up and insuring mortgages from banks at a faster pace since the recession started, especially mortgages of people who couldn’t cover the 20% down payment. From Wikipedia:

The Canadian mortgage securitization market has grown from

* 100 billion in 2006
* 130 billion in 2007
* to 295 billion by mid-June 2009

CHMC plans to expand securitization of debt to 370 billion by the end of 2009 as per the Government of Canada request.

Soooo basically, instead of playing safe, when the bubble hits it will be all the taxpayers’ money going up in smoke. These numbers might seem small compared to the US numbers, but let’s not forget that the US is at least 10 times more populated than Canada.

My boyfriend and I have pushed back plans to buy until the bubble explodes, and we’re in no rush. We almost bought a house two years ago, and the bank was willing to offer us 450,000$ and the house we wanted at 340,000$ was already gonna be tight to pay. I can’t imagine people buying to the full extent of their loan!

Kinda like having a blind brother on the rails of an incoming train who hasn’t yet noticed the nearby corpse of his brother.

Now it’s ending.

I actually saw this coming some 3-4 years ago and when I wrote same online, I was roundly mocked and called rude things by people who obviously had their heads planted firmly up their derriere.

Because it’s come true. No, I’m not psychic nor a prophet.

I just figured that the powers that be had bled the people so dry that once the corpse (economy) fell over, they’d walk away.

So we get to fend for ourselves, and try to get by with cash (which the powers that be will be outlawing some day soon in order to place even more control over the “unwashed masses” / “small people”).

The survivors of the econocopalypse will do as our great grandparents did, and will have to establish some form of real money and will have to save for things wanted.

My grandfather delayed getting married for almost a decade (early last century) in order to build a home and pay off a farm. As in, own everything outright.

It’s a telling tale that my 2nd cousin has lost the family place 110 years later, by not being able to pay loans obtained on it.

The biggest mistake the U.S. made last year was to spent TARP money on the “too big to fail” institutions.

They should have failed, and the TARP money should have been used to set up four brand new government owned banks with clean books.

Precise strict, but fair, borrowing guidelines could have imposed by the governments on those new banks, and credit would have been available right now for the average American with a good credit score and (small) businesses.

TARP is gone now, and so is the opportunity to make lemonade out of lemons.

- The III

And here is a challenge for you. Compared to many countries in the world, if you own a car, have more than one set of clothing, have more than the next meal in your pantry, have more than a dollar in your wallet or own a home you are, by their standards, “rich”. You who distort the Bible and claim that the rich should give all of their money to you are going to have address the reality with our Creator that you, too are rich by the standard of many people. Perhaps you should start practicing camel stringing if you want to go to heaven.

Yes I know I am basing the situation on an unrepresentative sample but so is the author of this post.

I’m a loan officer at a small community bank. We’ve got around 90 million in assets, so we’re a small fish. As such, we service our own loans. We didn’t make risky subdivision and commercial loans, etc. That’s not to say we’re not suffering some like most banks are, but we’re in pretty good shape considering the situation. I’m making loans like I always have, but am turning down more people who have bad credit due to recent implications. We are still making loans, but have more OCC requirements within the last two years than we have ever had in the past. The OCC examiners are becoming extremely hard to work with regarding loan requirements. We’ve got long time customers that have perfect credit and have always paid as agreed, but may not cash flow on paper due to a rough 2009. The examiners are eating us alive because of their cash flow on paper, even though they are making their payments. We are, in some cases, required to reserve for these loans now. So to your post regarding lending restrictions, bank examiners are as much or more to blame than the lending institutions in many cases.