The housing boom, ecconomy going good, so sup-prime became all the rage. Cheap adjustable rate morgage became real popular because the ecconomy was going so well that the adjustable became dirt cheap. Ecconomy doing well, so can always pay off a morgage, get as big as you can possibly afford, maybe a little bigger even, no prob.
The moragages were all bundled together & resold as big blocks to other firms.
Now the ecconomy is pretty good, not great, so rates go up, a few less raises, & it all goes to heck. Folks can't pay thier bills, the rates go up a notch, and everyone needs to sell.
Drives the market down, so they owe more than it is worth because they only owned it 2 years.
So, the govt will need to come in & bail out the morgage holders & those that can't pay their bills.
The ecconomy is now worse because of all the mess, so those big firms that invested wisely & carefully & those of us who pay our bills & don't go in too deep will suffer from those effects - and no govt help from us - actually we are the govt help paying that bill.
Like always. Same song, every 20 years or so.
To the original question, at this point it should not affect farm types so much. It is mostly all very similar tract housing, which coulds all be bundled together as same type of loan. Be glad if you have a farm & not that type of housing & loan. The farm stuff should only get dragged down a little, not so bad.
Not much adjustable loans on farm land - different catigory, could not be bundled into the big loan sales between big firms. Everyone got too complacient with those, let it build up into the problem it is. Everyone could see it coming, but no one could get off the wheel - have to play it out to the end & then take the govt handouts. How business is done.
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Today's Featured Article - A Cautionary Tale - by Ian Minshull. In the early 1950s my father bought an Allis Chalmers B and I used it for all the row crop work with the mangolds and potatoes, rolling and the haymaking on our farm. The farm and the Allis were sold and I have spent a lifetime working on farms throughout the country. I promised myself that one day I would own an Allis. That time event
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