Упрощенная HTML-версия
96
finite. Just here the risks of bad faith had taken effect. There was mortgage borrower
standard decreasing [2].
To meet the demand for new mortgage loans, lenders lowered standard re-
quirements for borrowers and began to grand loans to unsafe clients, increasing the
level of risk. New mortgage companies appeared on the market. Banks began to issue
mortgages directly for several houses and to low-income people. It all worked, be-
cause the rates were artificially depressed and house prices had been constantly grow-
ing. When all that changed, people could no longer afford monthly payment on the
mortgage. There was the avalanche of defaults. Purposeful defaults were being added
to them as house prices dropped lower than the cost of the mortgage.
Figure 1. Average price of houses sold
The above graph reflects average sales price of houses in the United States,
which is published quarterly. The graph shows that house prices peaked in late 2006
and then began to fall, causing rising defaults.
Artificially lowed interest rates set by the FED (the Federal Reserve System)
have contributed to the financial crisis. The reason for this was the previous crisis,
which occurred when the dotcom bubble burst. Then the FED dropped the rate to
stimulate economic growth. Low rates have persisted for a very long time. This was a
period when many mortgage borrowers took a loan with a floating interest rate, be-
cause they thought that rates will remain low, and thus payments always will be
low. As a result, loans took even those borrowers who could not afford it, and the
banks, knowing that the client had no money to pay the mortgage, it still was floating
loans, following the strategy of predatory lending.