The 2020 Mortgage Collapse - Why YOU Should Be Concerned! Today, we’re going to be investigating the rumours around the apparent ‘upcoming mortgage collapse’ where many experts are claiming that you simply won’t be able to get a mortgage very soon with banks and mortgage lenders going bankrupt!

So firstly, let's start with what we do know: a large amount of mortgages and home loans have been frozen across many Countries…

Many mortgage companies have huge delays on processing mortgages, with some lenders backed up for months.

But on the flip side, many house sales with valuations are going through at rapid speeds for 2 reasons: even though people suspect that prices might drop, they’re even more afraid of not being able to get a mortgage.

Because they know they might lose their job, they’re taking the lesser of two evils by locking in a low interest rate and getting a house now rather than later, even knowing it may drop in value

Lenders are being stricter about who they give a loan to due to the risk of unemployment, because they have no idea whether that person will lose their job in the next few months

Lenders know that as unemployment is going up daily, your risk of default increases daily too. Many people therefore, aren’t able to get a loan.
And if they get furloughed or their salary decreases, then their affordability for their next house will most likely decrease too. Which in a worse case scenario, could result in decrease in house prices City, County, State or Country wide.

Moving forward, we’re already seeing tighter lending policies. Especially if millions of people are going to be living off 80% of their previous earnings.

If interest rates have been reduced to 0.1% by the central bank, then why are mortgage providers charging higher interest rates… ? Shouldn’t the banks have passed on these reduced rates to you the consumer?