Mohacsy's Safe Portfolio Member Forum

[elena_murooni]

And, if prime mortgages are now in default, then the 401K money for those folks is exhausted? One of the 5 national reasons for a hardship withdrawal is foreclosure on a primary residence. Granted, liquidation of the assets held in the 401K can flood the market with sell transactions, but the liquidation in many mutual funds are not necessarily "putting money on the sidelines". Some of those redemptions were to fund a hardship withdrawal... just to pay the mortgage company.

I have to wonder, beyond job loss, exactly WHY the prime mortgages are in default when the mechanism to prevent it (hardship withdrawals/loans) are available.