We’ll still see a lot more short sales this time arond; that is, sales where the lender has already agreed to take less than the outstanding balance on the loan.

Then too, there will still be people who can’t afford any mortgage payment of any kind, because of job loss or illness. Think of how many people are in the construction and real estate businesses who are going to lose their income as a result of market slowdowns. Nothing is going to help the lender on that sitaution. If the mortgage payments were 30% higher than rent in ’91, they’re more than double the rents now. That’s going to add up pretty fast when considering how many of the buyers are already in trouble as of the next ARM adjustment.