2 Answers: Are Bonds Not Used to Purchase Homes?

Question

Learning more about the bonds market and wondering: Why aren’t bonds used to finance the purchase of homes?

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Mia Rodriguez 8 months 2 Answers 103 views 0

Answers ( 2 )

  1. Do you mean why don’t they get a bunch of mortgages and create a pool for investors.

  2. Someone or some entity would have to issue the bonds. If you think individual people can float a bond offering and sell it, you are mistaken. Would you buy a bond from some random person in Ypsilanti, Michigan that wanted to buy a 2500 sq ft home? You don’t know this person and neither do the vast majority of other people. His/her credit history could be crap, the bonds are defaulted, and bond holders are left with nothing or pennies on the dollar.

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