What is the ninja loan?

ninja loan is a free shortcut of without income, no work, no assets and term also represent something like a game on words. Since it is likely that the Ninja loan is likely to be paid, the debtor is described as Ninja, because it can disappear so easily, especially when it comes to payments. The use of Ninja is very criticized as a dangerous credit practice and can be partly responsible for the mortgage crisis in 2007 and the collapse of the financial markets in 2008. Indeed, what happened to many Ninja loans was that debtors or brokers deliberately falsified information about jobs, income or assets. Alternately, the creditors only took the word of applicants without verifying them. The mistake was not only on the side of the candidates, many of whom submitted real applications, but also for creditors who lent loans ruthlessly.

In addition, many types of ninja loans were sold to companiesAs Fannie Mae and Freddie Mac, which significantly contributed to the mortgage crisis, and some were part of the collateralized debt obligations in which people from companies such as Bear Sterns, Aig and Lehman Brothers were invested. Although the Ninja loan itself cannot be held solely responsible for the collapse of the economic markets and the housing industry, which resonated most of the world, it was certainly one loan practice that caused huge problems and illuminated irresponsible actions by the lenders.

In the light of this crisis, however, some companies have created Ninja loans to help save other companies in trouble. This was one of the intention of the wrapped economic assistance underwent in the US at the end of 2008. Other creditors responded to the crisis by developing extreme caution, which means that all information presented by loan applicants are checking twice and increasing requirements for things like "good" credit score.

One of the reasons why ninja loans became popular wasthat they were borrowed at the Subprime rate. This meant that debtors would pay much more interest for repayment of loans, which could add significant profits to creditors. Instead, the creditors did not receive the lack of proper screening of applicants and lent money to people who were not in a position to pay loans. History can one day display a ninja loan as one of the least responsible acts of the credit industry at the end of the 20th and early 21st century.