Yet more canaries chirping.
In the rest of the country where a person can buy a house with 3.5% down we have a large number of new home owners with little to no skin in the game. Maybe they knew some people who were foreclosed on last time. Maybe they heard of people living in the homes for 12 months without making a payment and think they might get so lucky. Maybe they bank with Wells Fargo and don’t give a shot if they default.
This could lead to an tsunami of bad mortgages.