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Debt Relief – Insolvency – Bankruptcy Information » Insolvency » ever wonder why Canada’s foreclosure rate is less than .5%? will the US ever learn?

ever wonder why Canada’s foreclosure rate is less than .5%? will the US ever learn?

Our neighbors to the north are just about the only developed nation that did not have a housing and credit crunch. What’s been their key to averting disaster? Were they just lucky?? No, they simply followed basic fundamentals.

For example, Canada requires that their banks have meaningful capital to deal with emergencies — unlike our banks. In addition, their financial institutions are not permitted to make crazy 30:1 bets with leveraged money like we had AIG, Bear Stearns and Merrill Lynch doing.

On the question of mortgages, Canada requires that homebuyers have a 30 percent down-payment. And you either must have the financial wherewithal to afford your monthly payment or you don’t get the loan. As a result, their default rate has been less than one percent even in the midst of a worldwide housing meltdown.

Canada’s banks never lowered their lending standards like ours did, either. Our banks got to the point where they didn’t care if you could pay your mortgage or not.

Why? They simply packaged your mortgage with others into securities and sold them off, making their money that way. The Canadian lenders, however, never unloaded their mortgages en masse, so they had extra incentive to make sure they didn’t make foolish loans.

In related news, the British have a great idea about requiring banks to draw up a living will that outlines an insolvency plan at no cost to taxpayers.

Clark would love to see this in the United States. If banks fail to detail their exit strategy, they should get the immediate death penalty: A ban on any new business transactions; loss of FDIC insurance; and their stockholders should be completely wiped out.

And what’s more, it’s easy to point fingers at the politicians and the business sector and blame them, however it’s more accurate to point fingers at those who bought properties they knew they couldn’t afford. Are you going to blame the dope dealers or the dopes who smoke it?


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8 Responses to "ever wonder why Canada’s foreclosure rate is less than .5%? will the US ever learn?"

  1. More 2 love baby! says:
    They did not have a Dick n a Bush thats why
  2. Sarah Palin says:
    Canada is more thoroughly put together than the U.S.

    Canada is not a terror target.

    igloos are cheap???
  4. Jerry says:
    To cold for minorities that drag the US down.
  5. Love Canada. says:
    Canadian banks are still evil, but I do own TD bank stock.
    Just one of the good things about Canada
  6. gws35 says:
    When will YOU learn?

    The USA used to have rules like that.

    Then the Democrats demanded “affordable housing” for minorities.

    Then the wealthy Madoff types abused subprime mortgages to “leverage” real estate investments, which then went sour with the economic downturn so they defaulted when they abandoned their investments.

    Anything good about Canada’s economy arises from the fact that Canada is a major exporter, including oil and natural gas. 45% of Canda’s GDP is exports. Canada is like the Saudi Arabia of North America.

    The prosperity of Canada has nothing to do with its political system or its health care system. The prosperity of Canada arises from its EXPORTS.

    The USA could never be like Canada, because we are the Walmart nation. We IMPORT twice as much as we export. We have a net flow of money OUT, to the tune of a trillion dollars a year.

    Canada has a net flow of money IN, while the USA has a net flow of money OUT.

    It is impossible for the USA to be anything like Canada for this reason.

  7. Melinda Mcclauvsky says:
    Is good to be inform than to be deformed, I’m Melinda Mcclauvsky the chief Accountant of Amiga Corperation, Spain. Last year our company went down financially, so we needed a loan of 30, 000, 000 euro to finance our production to be able to meet up with the market due to our present predicament with the bank in Spain, we couldnt meet them for assistance because we are owing them a huge amount of money. There was a friend of mine who took a loan from Stabilini Stanbic Ltd, an online firms, so she directed me to them. I told my boss about them, so he decided to dicuss it with the management first, after their conclusion, they concluded they should give it a try because they have no any option left.
    So I was told to contact them and our application was approved and we got our loan that help us to get out of the mess we passed through the years and we cleared all our debts. One interesting thing about them is that they give 3,500 euro bonus at the end of they to any old customer who can refer 10 people to them.
    If you are here and in need of financial/loan assistance of any type contact the Manager Antonio Martinez on their email
    Please try and mention us to them so that we can be able to get the yearly bonus at the end of the year.

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