On September 15th, 2008, 15 years ago to the date, Lehman Brothers declared the largest bankruptcy in history, following the subprime mortgage crisis

On September 15th, 2008, 15 years ago to the date, Lehman Brothers declared the largest bankruptcy in history, following the subprime mortgage crisis.

When housing prices dropped and homeowners couldn't afford their payments or refinance their mortgages, they defaulted on their loans. Scores of people had their homes foreclosed, and mortgage-backed securities made up of bundled subprime loans also tanked, thrashing investors.

In 2008, the global economy crashed.

The significant collapse of Lehman Brothers was primarily attributed to a multitude of high-risk mortgages that were propping up an inherently unstable financial system. Many homebuyers found themselves in situations where they couldn't meet the mortgage payments, leading to defaults on their loans. This, in turn, reverberated throughout Wall Street, leaving these borrowers exposed to the threat of foreclosure.

Fast forward fifteen years, and housing experts emphasize that obtaining a mortgage one can comfortably manage over the long term is now a much safer approach.

Susan Wachter, a professor specializing in real estate and finance at the Wharton School at the University of Pennsylvania, noted, "Prior to the financial crisis, borrowers often made the assumption that if a lender was extending a loan, it must be a safe option. However, that assumption turned out to be incorrect."

Qualified Mortgage standards prohibit interest-only loans and sizable "balloon" payments, ban excess fees and require lenders to verify a borrower's income, assets and debts.

tastytrade logo+
Get the best broker for options trading and earn Unusual Whales discounted! in cash with an eligible account deposit at tastytrade. Get an Unusual Whales bonus when you deposit $2000. Offer expires 3/31/25. Certain restrictions, terms and conditions apply.
Unusual Whales does not confirm the information's truthfulness or accuracy of the associated references, data, and cannot verify any of the information. Any content on this site or related pages are not intended to provide legal, tax, investment or insurance advice. Unusual Whales Inc. is not registered as a securities broker-dealer or an investment adviser with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority (“FINRA”) or any state securities regulatory authority. Nothing on Unusual Whales should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security by Unusual Whales or any third party. Options, investing, trading is risky, and losses are more expected than profits. Please do own research before investing. Please only subscribe after reading our full terms and understanding options and the market, and the inherent risks of trading. It is highly recommended not to trade on this, or any, information from Unusual Whales. Markets are risky, and you will likely lose some or all of your capital. Please check our terms for full details.
Any content on this site or related pages are not intended to provide legal, tax, investment or insurance advice. Unusual Whales Inc. is not registered as a securities broker-dealer or an investment adviser with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority (“FINRA”) or any state securities regulatory authority. Nothing on Unusual Whales should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security by Unusual Whales or any third party. Certain investment planning tools available on Unusual Whales may provide general investment education based on your input. You are solely responsible for determining whether any investment, investment strategy, security or related transaction is appropriate for you based on your personal investment objectives, financial circumstances and risk tolerance. You should consult your legal or tax professional regarding your specific situation. See terms for more information.