socialmedian: Could banks be in more trouble than they've let on?

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Could banks be in more trouble than they've let on?

Source: WalletPop Blog

Nov 02, 2009

Summary

Filed under: Banks, Real Estate

Federal Reserve Chairman Ben Bernanke recently talked about "green shoots" of economic recovery and declared the recession probably over, but some economists fear the worst is yet to come.

As bad as the residential real estate crisis was for banks, the impact of failed residential mortgages could be dwarfed by the problems now facing the banks regarding commercial real estate.

A loan for a commercial building like a shopping mall is very different from the mortgage you have on your home. Commercial mortgages have a much shorter term, usually only five to seven years. The bank doesn't expect the owner to pay the debt off in that amount of time, but when that time comes, they need to refinance the remaining balance into a new loan.

Continue reading Could banks be in more trouble than they've let on?

Could banks be in more trouble than they've let on? originally appeared on WalletPop Blog on Mon, 02 Nov 2009 17:30:00 EST. Please see our terms for use of feeds.

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