The banks are scrambling to figure out how to write new business but not compound the errors of their ways by creating bad mortgages.
One of the latest ideas is targeting grandma and grandpa who probably haven’t gone crazy leveraging their home which might even be paid for.Â In order to get them to take on some fresh debt the appeals are for them to help their grandchildren go to college or buy their first home.
It’s a way for banks to write mortgages that have high loan-to-value ratios and be able to collect feels and securitize them due to their added safety.
This holiday season probably more than a few grandparents will get a proposition after a few glasses of eggnog as they are sitting comfortably by the fire.
As the system searches out any potential for fresh liquidity the last bastions of safety will get assaulted.Â Grandparents need to brace themselves for the marketing onslaught.
— Kris Tuttle