How has subprime lending affected the housing market?
Beginning around 1996, housing prices began to escalate rapidly, going up 124% by 2006. Also, because of, among other things, the dot-com collapse of 2000 and subsequent recession, interest rates were lowered. This caused…excuse me, are you snoring? Q: Sorry, just nodded off. I’m with you. Keep going. A: This caused many people to refinance their mortgages and lenders started offering low-interest to subprime borrowers. Q: Like me. A: Yeah, like you. Many of these loans were offered with teaser rates.
