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Effects Of The Housing Crash Of 2008

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The housing crash of 2008 was a financial crisis that occurred in the United States and had a ripple effect across the world. The housing market had been booming for several years, and many people had taken out large mortgages to buy homes they couldn't afford. Banks and other financial institutions were eager to lend money to these buyers and they often packaged these mortgages into complex financial instruments that were sold to investors. However as the housing market began to slow down many homeowners found themselves unable to keep up with their mortgage payments. This led to a wave of foreclosures and a glut of homes on the market which in turn caused home prices to plummet. This created a downward spiral, as homeowners who owed more on their mortgages than their homes were worth found themselves in a precarious …show more content…

The fallout from the housing crash was widespread and long-lasting. Millions of homeowners lost their homes and many more saw the value of their homes plummet. Banks and other financial institutions suffered significant losses, and some even went bankrupt. The stock market also took a hit, as investors lost confidence in the financial system. The US government and other countries implemented various measures to try to stabilize the economy and prevent a complete collapse. The Federal Reserve lowered interest rates to make borrowing easier and the government provided bailouts and stimulus packages to banks and other industries. However these measures were not without controversy, and some argued that they only prolonged the inevitable correction of the housing market. The housing crash of 2008 highlighted the dangers of a housing bubble and the importance of responsible lending practices. It also exposed flaws in the financial system and led to increased regulations and oversight of the

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