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Questions and Answers
What led to lax lending standards in the US housing market in the 2000s?
What led to lax lending standards in the US housing market in the 2000s?
- Stringent credit requirements for borrowers
- Demand for mortgage-backed securities (MBS) (correct)
- Increased government regulations
- Decreased investor interest in real estate
What type of loans were commonly given to people with low income and bad credit during the housing bubble?
What type of loans were commonly given to people with low income and bad credit during the housing bubble?
- Fixed-rate mortgages with high credit score requirements
- Government-backed loans with stringent conditions
- Prime loans with low interest rates
- Subprime loans with high risk levels (correct)
What was a common predatory lending practice during the 2000s housing market boom?
What was a common predatory lending practice during the 2000s housing market boom?
- Utilizing adjustable-rate mortgages with low initial payments (correct)
- Providing transparent loan terms for borrowers
- Strictly adhering to conventional lending guidelines
- Offering fixed-rate mortgages with long-term stability
What effect did the bursting of the housing bubble have on house prices?
What effect did the bursting of the housing bubble have on house prices?
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What was the main reason behind creating the Troubled Asset Relief Program (TARP) by the government?
What was the main reason behind creating the Troubled Asset Relief Program (TARP) by the government?
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What did the Dodd-Frank financial reform bill aim to achieve following the 2008 crisis?
What did the Dodd-Frank financial reform bill aim to achieve following the 2008 crisis?
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How did investors mostly contribute to the housing bubble according to the text?
How did investors mostly contribute to the housing bubble according to the text?
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