The reason our current credit crunch has this nation bowels tied up in knots, is the subject of this article, "mortgage loans for people with no, or bad credit"! I don't know and doubt anyone can discern from the wording of this title if the writer is seeking a negative or positive input, but I can tell you, the people and programs that generated mortgages for this class of business have seen their "baby" grow into a monster of a man!

The basics of a mortgage loan is that the credit history of the applicant is sound enough to predict that a high percentage of those awarded a mortgage loan will pay for the loan on a regular basis. The mortgage loan business existed in ancient England, most of the continent and even into the far east, there are viable examples of significant amounts of money changing hands based on the applicants credit history, reputation and credibility, for housing purposes. The mortgage business went fairly well, suffering its usual peaks and valleys until the late 90's and the early 2000's.

At that point the housing market began to show signs of taking off with a huge volume of applicants for loans. Real Estate values begin to move up across the nation to the point a significant amount of capitol had to be set aside in order to meet loan demands. During the late 90's many mortgages were granted and the industry temporarily ran dry of funds. The system was too slow to to gather up good mortgage loans and package them for sale to large scale buyers. The initial answer to this was to hire more loan processors and simply make the loan packages quicker, sell the packages and re-invest the money in more mortgages. This first system change worked for a time, but the volume of applications exceeded even this system and the need became every more urgent.

I'm sure some of the elder statesman in the mortgage business must have counseled caution to those who wanted to alter the system so more money became available sooner. Their voices must have been drowned out by the screams from the field for more money!

There is a lot of money to be made in mortgage loans! The loan seals a real estate deal and the realty agent/broker system is fueled by mortgage money. If the average home is selling for $200,000, the realty fees run from $10,000 to $14,000 per sale. Some agents were going to a closing a day at the height of the realty boom! Can you imagine their screams when a sale went south because some idiot back east couldn't get a package

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