[quote=deadzone] . . . Basically EVERYBODY who bought a house in San Diego between 2004 and 2007 F-d up big time, regardless of their job status they are almost guaranteed to be under major water and job or not, many of these folks are at their limits in terms of paying the mortgage . . . [/quote]

I understand prices were high in those years and I know a few people that have been in the RE biz awhile that overextended themselves (buying too many investment properties at inflated prices which proved to be money drains). But fixed rate programs DID exist in those years. The fixed rate in 03/04 was VERY low. The OPTION to pay the fully amortized rate (Option 3) on an OPTION ARM DID exist in those years because I had one and I paid it!

Even if your co-workers paid up to, say, 20% too much in the “bubble years,” they might still be able to hang on with (lower payments after reset) and keep their good credit/security clearances IF they made wise financing and payment choices in the origination of their mortgage or early years of their “evil” Neg Am ARMS.

Your co-workers obviously screwed up so they could have more discretionary income in the first years of their mortgages, which is the time they should have paid the most in interest. Those choices got them where they are today (and certainly falling values didn’t help, either).