Canada – Liar loans helping to inflate hot housing markets, experts say

New allegations of broker fraud come amid fresh warnings about lofty real estate prices in Vancouver and Toronto markets and their surrounding suburbs.

Stated income or “Liar Loan” create an indicia of affordability – thereby allowing a bubble to continue to inflate, long after it should have popped.  The US Markets experienced this during the run-up to the financial crisis when negatively amortizing and no documentation loans allowed people to purchase homes which were simply unaffordable.  -Rachel

Rachel Dollar

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