mr mortgage’s thesis is that resets matter less than equity or lack thereof. i agree with it as it’s logical, reasonable and tends to be backed up with the numbers; despite the lack of reset (lower rates, farther out time frame), nod’s to alt-a morts are rising fast. presumably due to negative equity.
using that, foreclosure activity should accelerate ahead of the reset chart, especially now with rising libor and continuing price drops. i’m thinking that some 25 to 50% of 2004+ vintage alt-a holders will jump ship (jingle mail, squat, short sell, etc) before being stuck in the position of both neg equity and doubled payments.
it might not take but a year or two to “get there”.
i’m also thinking that may be the “holy shit” moment when j6p finally gets it; housing isn’t turning around, real estate doesn’t always go up, credit isn’t free. the msm will be permanently glum, the markets will have tanked, banks gone tits and satan begins his reign of terror.
