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Some of the same strategies that landed sub-prime borrowers in trouble are becoming increasingly popular among the rich as wealth-management tools. [NYT]

8:39 AM on Tue Mar 18 2008
By Ben Popken
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5 comments

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  • No commenter image uploaded EJXD2 at 09:04 AM on 03/18/08
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    Wasn't this obvious already? The best part of the so-called subprime mortgage meltdown is that the rich get richer buying devalued property!

  • No commenter image uploaded APFPilot at 09:35 AM on 03/18/08
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    I live in Naples and really haven't seen much change in the more affluent part of town. I've had no problem getting a loan through Northern Trust.

  • No commenter image uploaded plustax at 02:41 PM on 03/18/08
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    I had a few bankers take a look at doing this for a bunch of my high net-worth clients and all of them said it was too soon that the rates will drop even more in the next few months. We're taking a wait and see approach at the moment.

  • No commenter image uploaded artki at 03:53 PM on 03/18/08
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    Of course. The wealthy realize that if it turns out bad they can count on a bail-out.

  • No commenter image uploaded RogerDucky at 03:59 PM on 03/18/08
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    @artki: Not really. It's banks trying for "AAA+++" accounts with the same kind of potential profits that appeared to work for subprime for a very short time. They need to do that to bolster their mortgage portfolios. Plus, originally, these strategies *were* designed for people with more money than they know what to do with -- they got applied to the lower-tiered people only when banks figured they'd make all their money back from the repos, which turned out to be a really bad assumption.

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