By ERIN FLYNN JAY
Mortgage loans have some risks, as do student loans. But the two don’t add up to a toxic combination that threatens to cause a price crash in the housing market, and trillions of dollars of damages for taxpayers to clean up.
A recent WSJ opinion piece by Allysia Finley claims taxpayers are standing behind trillions of dollars in risky mortgages due to the way that student loan debt is calculated during the mortgage process.
In “The Student-Debt Bubble Fueled a Housing Bubble,” Finley blamed student loan repayment plans, saying monthly payments are capped at 10% of discretionary income.
“Many student borrowers consequently aren’t paying down their debt, but it isn’t counted against them when they attempt…
By CHUCK GREEN and KIMBERLEY HAAS The U.S. Supreme Court will be hearing two cases challenging the legality of President Joe Biden’s student loan forgiveness plan on Feb. 28 and The Mortgage Note is asking the question, why not mortgage debt relief when that is a bigger burden to average Americans? Mortgage balances rose by $282 billion in the third quarter of 2022 and were at $11.67 trillion by the end of September. According to a press release issued by the Federal Reserve Bank of New York, student loan balances slightly declined to $1.57 trillion. Total household debt reached $16.51 trillion in Q3. That includes mortgages, credit cards, auto loans, and student loans. Sarah Paulson, a certified financial planner at Valkyrie Financial…
Americans made a dent in their debts during the pandemic, according to a new study from QuoteWizard. Analysts for QuoteWizard, an online lead generation marketplace for insurance, monitored thirty-three debt metrics between February 2020 and October 2020. They found that credit scores improved, people made more payments on their student loans, and the number in debt collection dropped. Nationally there was a 10% decrease in subprime credit scores and a 2% decrease in debt collection. Student loan delinquency and credit card delinquency both fell, by 32% and 31% respectively. “Americans having less debt has broader implications across the whole economy. The better your credit score, the less you are going to pay on everything from auto loans and home mortgages…
