Are sub-prime mortgages really bad? I don’t live in a major centre like the GTA where a little bungalow can cost more than 500,000, so I did not at first understand the need for these high risk mortgages. But when someone explained to me how it is next to impossible for him to buy a home, it started to make more sense.
The obvious problem is “high risk,” which becomes extreme danger when the economy tanks. However, if everything is good, the would sub-prime, 40 year mortgages be alright?
Or maybe the problem is just that in some places, housing just costs too much, and is a problem when you have other parts of the country where housing is cheap. Would this then suggest that we have some kind of economical imbalance where too much of our economy is built around these major centres? Perhaps we need to find programs to encourage business development to spread out into other areas of the country, intead of having everything in the Torontos and Calgaries of the country.