TheRealMafoo on 12 July 2009
| akuma587 said: Yeah, adjustable rate mortgages have always been pretty dangerous, but fortunately a lot of people have taken advantages of the low interest rates and re-financed with a relatively low fixed mortgage rate. |
The ones that could.
If you have an AMR on a house, and owe 200K on it, and the house is worth 180K (or less), you can't refinance. That's a very large category of home owners.
Not to mention the people who can afford to make there payments, but find it better not to. If someone still has a job, a 400K house with close to no equity, can still make his payments just fine, but the house is now worth 200K, letting it go is like making 200K in cash.
The question for people in that situation, is "is my credit rating worth 200K?". To a lot of people, the answer is no.
