Sep 13 2009
Interest Only Mortgage Time Bomb: $71 billion in Loans will Reset in next 12 Months. Total Loans Outstanding at $908 Billion. Average Balance of $324,000. Median U.S. Home Price $178,000.
Interest only (IO) loans seemed like a viable mortgage option when home prices were appreciating on a double-digit basis every year. The interest only loan allowed borrowers the option of making no principal payments for 5, 7, or even 10 years. Now why would someone not make any principal payment for such a long time? […]
Aug 20 2009
Home Equity Loans: $674 Billion in Total Loans. When The Household ATM Goes Out of Order. First, Second, Third, Fourth, and Even Fifth Mortgages.
Home equity was once seen as a cushion for a rainy day. People built up home equity as a means of paying off their home loan and saw it as a source of security. The days of the mortgage burning parties were all but lost in this housing bubble. The roots of the housing bubble […]