Bugs… I know that all areas of the country have had access to the same credit terms, but do you think that lenders have attacked all areas of the country like they have in SoCal and other bubble areas? with all the ARMS/IO, etc. I briefly considered buying last year and calculated that we could afford in the neighborhood of a $450,000 home (based on approx. 35-40% of income, 15% down payment, etc). Well, the lender called the realtor and told her that we were approved for up to $650,000. I was blown away. I would never even have dreamed of making a purchase like that. But I’m sure a majority of people would have jumped at the chance to “own” a $650,000 house.

Yet, a good friend of mine just purchased a home in Michigan last month and was barely approved for a loan of $140,000 (good credit, just a low monthly income). I think that the lenders have preyed in the areas of the country (particulary SoCal) where people will do anything to look the image. They’ll throw common sense out the window to have a bigger house than their friends. Perhaps the midwest or any other areas relatively untouched by the bubble aren’t concerned with those factors. In fact I’d argue that the only reason some of those areas have seen any increase in price is because of Californians, etc. cashing out and taking there money there.

I’d be interested to hear if people in other parts of the country are/were constantly bombarded with lending ads, home equity lines of credit, etc.