Hi Jonze, I think there are thousands of idiots like the one you mention. I read a story on the housingbubbleblog, from a FL newspaper article, describing a 23 yr old woman who bought 8 homes with 100% financing, all within a couple months. It’s unbelievable that she probably qualified based on her assets. Each asset would be the equity in the previous homes. An honest appraiser would have alerted the lender to the prior deals and not inflated their values. How can you have any equity on a home 100% financed just a week ago? The investors who bought these 1st and 2nd deeds deserve to lose all that money.
The sad thing is that many of these “investors” are your parents and grandparents, who were seeking the 10% interest that is guaranteed by these deeds. Anyone reading this, please ask your fixed income friends and relatives if they purchased any fixed income investments other than CDs. If they bought deeds or mortgage backed securities, beg them to sell.
People don’t realize that higher yield means higher risk, and a fixed interest of 10% practically guarantees you’re going to lose your principal.
