Mortgage delinquency rate highest it's been in 21 years....

[Jack B.]

https://www.yahoo.com/money/earlystage-mortgage-delinquencies-hit-21-year-high-170612193.html

I wonder if this crash could be bigger than 2008. Foreclosures drove that due to predatory lending. But now more so than back then more people can't pay their mortgage and are behind on them. Hmmmm....

[Moises R Cosme]

Jack, 

I do not think we are looking at 2008 again.  

Three reasons: (1) the federal government is still in the driver's seat with Fannie Mae & Freddie Mac, so those mortgages will get deferred or worked out in some way; politicians got killed last time for the foreclosure rate, so they are not going to let it happen again and (2) the fundamental structure around loan origination is a million times better than it was in the run up to 2008; between 01 - 07 you did not need a license to originate a loan once Dodd-Frank passed and licensing became the standard a lot of bad loan officers got out of the business, and (3) Banks also tightened up their verification standards ( I know the standards are still relatively loose) but 4506T forms were not used between 01 - 07, so people lied about their income; after 2008, banks started to use 4506T forms to verify tax returns.  Verifying taxes alone makes a huge difference in the quality of the underwriting.