Good question. I just work on the credit reporting side so I don't see the actual decisions, but if you have enough people with history this bad applying for mortgages then that must mean that a decent amount of these people are getting approved. If it were impossible, or at least very unlikely, for these people to get approved then you wouldn't have these huge numbers of these types of people applying.
One thing that our clients use our services for is to massage the numbers. So, lets say you have an applicant with a particular credit score but they have a bunch of outstanding balances--a couple hundred on a credit card here, a couple thousand on an unsecured installment loan there, a few tens of thousands on a HELOC elsewhere, etc--the lender will have that person make a couple extra payments on their balances or clear out smaller ones so that on paper, for the lender's internal calculations, their financial situation looks better. My company internally calls those "cosmetic changes" to the credit report. We don't actually improve the applicant's credit score because that is all handled by the bureaus, but in the short term it makes it easier for the lender to meet their own internal standards (at least on paper) and thus get the loan approved. In the end the loan will just get sold off to another servicer anyways so they don't really care. Our clients are major banks and lenders that everybody (at least in the US) knows about and many people on this forum probably have multiple accounts with.
Its mostly cosmetic because a lot of people with bad credit will repeatedly make bad financial decisions. Its all short term just enough to get that mortgage approved.
Don't get me wrong, we get people who have great credit or have had one or two negative events in otherwise good histories so its not a complete disaster, but the amount of those people with lower-tier credit is extremely concerning and kind of scary. I don't see the bigger picture, i.e. the local economy tanked and their business suffered, that kind of thing. But when you have someone with multiple civil judgments and charge-offs spanning multiple years plus years of repeated 90+ day late payments on credit cards then you know something is going on.
On a side note there's a grocery warehouse for a major retailer near me that pays really well--actually better than what I'm making now. I might just apply there since they're always hiring and I don't know how long this subprime bonanza can last. If its a choice between walking away from a mortgage and buying food, you know full well which one people will choose and which company will have more work.
- Inflation, based on the hitherto honest rather than current CPI scale, is factually at 9%, not the farcical 2% range. In short, inflation is already here;
- Unlimited QE, by definition, means greater money supply, and inflation, by definition, is about precisely that: Increased money supply;
- QE for Wall Street (and the embarrassing new reputation of MMT) is slowly being joined by “QE for the people” in the form of unprecedented, “COVID-justified” broad money creation and fiscal deficits to directing money (and the velocity of the same) straight into Main Street, a classic tailwind for rising inflation;
- The now openly felt winds of a commodity super cycle is driving commodity prices higher in everything from corn to plywood, all further (and undeniable) tailwinds of increasing inflation;
- Finally, and perhaps most importantly, governments around the world have never, not ever, been as deep in debt as they are today, and the only way to dig themselves out of the Grand Canyon of debt in which they and their central banks put themselves (and us) is to now inflate their way out of it. In fact, just last week, the ECB openly confessed as much.
Some more tweets on this topic:
Entertaining exchange here - Saifedean is a thought leader in exploring the larger implications of inflation & fiat on society.
0-100 real quick lol, is saifdean always like that or is there some beef between these two? Or is he referring to Keynes as the child rapist?
Yep. Keynes was as much GloboHomo as you can be. He did not care for the next generation, and probably was just a planted puppet by the PTB.He's referring to Keynes. The Bitcoin standard has a section devoted to how Keynes' theories on the need for inflation were partially motivated by his unconventional lifestyle practices and aversion to tradition. Once you go down the Bitcoin rabbit hole there's a lot to learn about the connection between sound money/deflationary money and progress in human civilization in general.