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Millions More Are At Risk Of Foreclosure Than Anyone Realizes

Most look to loan type and equity position as two of the most important factors when forecasting loan default. In fact, I believe that epidemic negative-equity is the overarching reason that the default, foreclosure and housing crisis remains in the early innings. But…negative-equity with a caveat.
While negative equity is a threat in and of itself, being in an over-leveraged household debt position is the true default catalyst for most in a negative-equity position. And being over-leveraged is also the primary default catalyst for those is a positive equity position. Being in a negative-equity position with lots of top line and disposable income each month is generally more of a mental burden than a reason to fly the coop.
How many homeowners are over-levered and at eminent risk of default? This answer is…a lot more than most think, especially those who got a loan from 2003-2007 due to a radical, yet subtle shift in loan guidelines across the mortgage spectrum that kicked-off the bubble-years.
Yes, even Prime full-doc borrowers in 30-year fixed mortgages with 20% equity who got their purchase or refi from 03-07 are at much greater risk than most think. Being over-levered was condoned – all the lenders, investors and loan programs operated in the same manner.

http://www.businessinsider.com/millions-more-...

What do households spend money in every year? The U.S. Census bureau provides the answers:
•$200 billion on furniture, appliances ($1,900 per household annually)
•$400 billion on vehicle purchases ($3,800 per household annually)
•$425 billion at restaurants ($4,000 per household annually)
•$9 billion at Starbucks ($85 per household annually)
•$250 billion on clothing ($2,400 per household annually)
•$100 billion on electronics ($950 per household annually)
•$60 billion on lottery tickets ($600 per household annually)
•$100 billion at gambling casinos ($950 per household annually)
•$60 billion on alcohol ($600 per household annually)
•$40 billion on smoking ($400 per household annually)
•$32 billion on spectator sports ($300 per household annually)
•$150 billion on entertainment ($1,400 per household annually)
•$100 billion on education ($950 per household annually)
•$300 billion to charity ($2,900 per household annually)

No wonder we’re in dire straits as a nation.