Archives for December, 2010

mortgage programs

The Real Israeli Mortgage Rules #4: things change all the time

Many times people will tell us that they heard their friend was offered such and such a mortgage at such and such a rate. Or the bank approved them for a 90% mortgage at prime-1%, only they don’t have a written approval. Banks talk, and only explain later that what they meant was a best-case scenario, and that only for a small portion of the loan. Don’t believe the hype. [Aside: I was in the mall this week and was tempted into a store with huge 70% off signs. Of course the small print is up to 70%. When I asked to see which products were included in this amazing sale, they could only show me a few mugs that were still no great...
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bank of israel

Once again, Governor Fisher quotes me

Bank of Israel Governor Fisher quoted me again yesterday. Well, maybe it was more of a paraphrase, you can read  a summary of what he said here. If you heard the news on any radio station yesterday you probably heard his money quote over and over: if you expect the prime rate to remain at 3.5% you’re a fool, and a fool and his money are soon parted. Stanley Fisher & me. He keeps getting awards for “economist of the year blah blah blah” by stealing my great ideas. I was slightly more eloquent than this, but I made the same point in only my last post. You don’t have to look far, just scroll down the page to my previous posting, I said...
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bank of israel

If you can’t break it with a hammer, try a sledge hammer

Just two months ago, the regulator of the banks introduced new regulations in an effort to limit the availability of mortgages in Israel.  I wrote about it here: New Mortgage Regulations. This wasn’t entirely new. About half a year before that they tried similar measures, and found that the law of supply and demand is stronger than regulation. Isn’t the Bank of Israel supposed to be an impressive collection of economists, how come they don’t get this most basic principle? Now they’re trying to get fancier, or more draconian, on us and are trying to limit mortgages to 50% and ban the prime rate mortgages. I don’t like these measures, but I think they are correct. Four years ago the prime was sitting more...
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