John Dugan Loan Quotations

If real estate prices decline, and there already is evidence of softening in some markets, these borrowers could face the bleak prospect of loan balances that exceed the value of the underlying properties.

But looser underwriting standards and the more widespread penetration of riskier mortgage products have raised questions about how these loans will fare in the event of a rise in interest rates or a softening in house prices,

The easier availability of first mortgages has helped many marginal borrowers obtain loans and it has helped banks sustain loan volume and profits.