picpoule, that’s what I’ve been saying for months. Exotic lending (which includes subpar borrowers qualifying for morgages) are leading to high foreclosures. You don’t need a housing bubble to lead to foreclosures, just poor lending practices. Whether you are in foreclosure on a $110K house or a $800K house really doesn’t matter. It doesn’t matter that your house appreciated 20% a year before you bought it, only that you cannot make your mortgage payment.
I was getting frustrated with comments on this forum which said that only CA and other bubblicious regions would see price declines. The truth is that any region which used exotic lending will see price declines. Show me an area of the US that did not sell exotic mortgages, and that region would be exempt from a downturn. I don’t know of any. Even my little Midwest conservative town of Omaha, NE is seeing price reductions and rising foreclosures, a new housing glut, and overuse of exotic lending.
However, no one is exempt from job loss in 2007-2008 recession. During the recession, even conservative borrowers will face foreclosure, as they lose their jobs and cannot make their payments. They will be sel
Anyone with a mortgage is susceptible to having to sell into a declining market. If you read this, think about whether your job will be safe in a recession. If not, or if you may be moving in the next 5 years, sell your house now, before your paper profits evaporate. Sell before your job loss forces you to sell into a lower market.
For the life of me, I don’t know why anyone would want to own a house right now. But then again, there is so much I don’t understand.
