[brownsfan019]

Also, I should note that the ARM is just one option available when getting a mortgage. Not everyone in the US has one, just those that were looking for a very low monthly payment @ the start of their loan. I just have a simple 30 yr fixed payment. Difference being that I was paying more initially than those with an ARM and now my term and rate looks like a bargain to those with an ARM.

[darthtrader]

It basically was a chain reaction in the hot markets. Rates got so low it brought in more and more buyers, then speculators then at a point I imagine property out west got so out of hand that people would not have been able to get in the house without an arm. You also have to figure that if you bought a house in 2003/04 in these markets you were probly up 100% by early 05. I'm sure that gave people confidence that even if the rate went up they could just sell at a profit.

Not everywhere experienced this though. In western ny here property really hasn't gone up much at all. a starter home out west is 500k, that puts you in the biggest houses around here.

i wish i had bookmarked it but i found a double wide trailer for 200k on here a few weeks ago
http://www.seattlepowersearch.com/

Most arms were 5 years, considering the big buying spree didnt happen until 03/04 we havent even started the resets yet.

[brownsfan019]

Originally Posted by darthtrader »

Most arms were 5 years, considering the big buying spree didnt happen until 03/04 we havent even started the resets yet.

Great point Darth.

This is just the start. It really is going to be interesting to see what happens - either the gov't steps in as many are begging them to do (not sure how though) or we see A LOT of foreclosures.

From a possible money making opportunity though... those with cash and good credit will be king here. Looks like there could be a possible housing upgrade in the brownsfan019 household possibly...

[Reaver]

lol yeah I agree....rates are dropping right now, at least where I work...just checked.....


Houses are popping up for sale like crazy in Pensacola FL....It is nuts...

My strategy:

Roy Jones, jr lives here...and if I am lucky, maybe he got an ARM and is gonna have to drop the ball on this one....

oh yeah. like Brownsfan said..there may be an upgrade in the near future. lol

but something tells me Roy Jones, jr didn't finance under an ARM...or maybe at all.

*sigh* back to the ol' drawing board I guess.

[MrPaul]

I thought I might stir the pot here a little.

First off I do agree that you should read a contract, and yes you should certainly employ common sense when obtaining a loan for any amount of money BUT....

Don't you find it interesting that these lenders actually thought they would lend money to underfunded, uninformed, ill advised people and thought that because the going was great and the housing bull would carry on forever that they would win out big with their bait and switch style teaser rates?

Perhaps I'm laying it on too thick but I say "boo hoo!" You want to take a gamble at the upper end of a housing bubble/boom and then when the market closes in on itself and THAT SAME sub prime market YOU HAVE BEEN EXPLOITING collapses you want to complain?

We all know about risk/reward, supply/demand, fear/greed manias and depressions in stock and futures markets, how is this different than someone with more money than intelligence over-leveraging themselves at the top of a huge bull market?

Now I should note that I do not think that people were "victimized" or that they should be taken pity upon. My point is that in the context of lenders, that if you play with fire you run the risk of burning yourself...

[Reaver]

Originally Posted by MrPaul »

I thought I might stir the pot here a little.

First off I do agree that you should read a contract, and yes you should certainly employ common sense when obtaining a loan for any amount of money BUT....

Don't you find it interesting that these lenders actually thought they would lend money to underfunded, uninformed, ill advised people and thought that because the going was great and the housing bull would carry on forever that they would win out big with their bait and switch style teaser rates?

Perhaps I'm laying it on too thick but I say "boo hoo!" You want to take a gamble at the upper end of a housing bubble/boom and then when the market closes in on itself and THAT SAME sub prime market YOU HAVE BEEN EXPLOITING collapses you want to complain?

We all know about risk/reward, supply/demand, fear/greed manias and depressions in stock and futures markets, how is this different than someone with more money than intelligence over-leveraging themselves at the top of a huge bull market?

Now I should note that I do not think that people were "victimized" or that they should be taken pity upon. My point is that in the context of lenders, that if you play with fire you run the risk of burning yourself...

I totally agree.

Lenders sure wouldn't have been crying if the market hadn't collapsed and people were eventually paying 13-14% on their mortgages...

They took a risk, and unbelieveably foolish one at that, and it blew up in their face.

Ya gotta pay the piper sometimes.

If I were to open a restaurant and do stupid business practices and I went under, then hey too bad...nodody's gonna help me out, I get to go back to working for someone else...as is the supposed nature of capitalism....but for some reason when these predatory lenders start to suffer for their misdeeds...they call on the government like they were some philanthropic group that fell on bad times....

Maybe it has something to do with the ungodly amount of money they funnel to the government in lobbying and campaign contributions each year....

This whole thing is just a mess...everyone involved should just own up to their responsibilities and move forward.