Mortgages as they used to be

I have just come across this and thought it was so good and so simple that I had to share it. Please remember that anyone who is around about 45 years older and more will recognise what you are about to read: this is exactly how it used to be.

“One case in point is Hudson City Bancorp, a 140 year old company based in Paramus, New Jersey that has managed to avoid the mortgage meltdown and continues to post tremendous results. Business journalists have discovered this quiet little outfit and marvelled at its strategic insights. Its shares are up 50% since last August, when the credit crisis really kicked in. "Hudson City banks the old-fashioned way," Newsweek marvelled. "It takes deposits and makes mortgages to people who buy homes in which they plan to live. And then it hangs on to" the mortgages, rather than sell them in the secondary market.

Imagine the brilliance! Take deposits. Make sensible loans. Repeat over and over again, until your market capitalisation approaches $10 billion.” PLEASE NOTE THE IRONY!!

The New York Times tried to unpack the secrets of Hudson's success and offered this analysis: "The bank carefully screened loan applicants to ensure they would be able both to afford a new house and reside there, rather than flip it. And the bank demanded hefty down payments ... as a cushion against any sharp drop in home prices, because it planned to hang on to the loans."

What a formula! Make sure borrowers can afford their loans. Insist that they make a big down payment. Favour owners over speculators. AGAIN NOTE THE IRONY!!”

The real benefit of what this traditional, safe and sensible mortgage provider does is easily seen in the following figures:

“The bank has written 100,000 mortgages worth $26 billion and has a grand total of 15 foreclosures. Not 15%, just 15 mortgages out of 100,000.”

Source: http://discussionleader.hbsp.com/taylor/2008/09/why_the_mortgage_meltdown_hasn.html?cm_mmc=npv-_-LISTSERV-_-SEP_2008-_-STRATEGY

So, here is the model of what we used to do in the pre Thatcher days. So what went wrong? It’s obvious isn’t it?!

DW

Windows Live Writer

I am always one to try something new and to be as up to date as possible in the computing world. I don’t necessarily have the biggest and best hardware but I like my software to be up to date.

I run Office 2007, I have just upgraded Smart Draw to version 2009, I have reinstalled Dreamweaver and yesterday I installed Acrobat Reader version 9. Just a few examples of my software world.

Here’s another example: I have just installed Windows Live Writer (Beta) and this message is coming to you, together with the following photo and table, courtesy of WLW. Let’s see if it’s any good. I am not going to stress the system, just testing as uploading photos to this Blog is a bit of a faff: not difficult but a faff.

I like this photo of some arch ways to be found in the Forbidden City: I call it Cloisters.

WLW also claims to be able to include tables in a posting so let’s try that too:

Destination	Duration
Geneva	6 days
Beijing	9 days

There you are and if I can shrink it down enough, I am going to upload a video of yours truly walking around a part of Beijing. The title includes the phrase Hapless Tyke, so that gives you a clue of the flavour of the film.

DW

Wise Words from Henry Ford

Remembering the apparently ongoing financial crisis, how prophetic are these words?

A business that makes nothing but money is a poor business.

True!!

DW
Sent from my BlackBerry® wireless device

Britain's Finest

Although I spend a lot of time abroad I do appreciate some of the finer things that Britain has to offer. To whit, I have just enjoyed a meal comprising wholemeal bread and butter with a plate of mushy peas. You can't beat that!

Please note, proper mushy peas made from dehydrated marrowfat peas and not, never, from a tin!

DW
Sent from my BlackBerry® wireless device