This article is worthy of its own thread. Until last week, I thought that I could help people by informing them of the option to refinance. I had an idea to distribute flyers to the high foreclosure areas in Poway (the cheaper smaller older homes), and explain ARMs and the benefits of changing to a fixed rate mortgage. Then it was explained to me that most of them won’t qualify, because they have HELOCed or refied out their equity, home prices have dropped and they lack sufficient equity even for a 100% loan, and, most important, their income hasn’t gone up enough to qualify them for an interest rate that is almost double what they got a few years ago. We need bank failings to get back to proper lending guidelines, we need foreclosures to cleanse the consumerism excess.
This article should have been written better to explain that most people won’t be able to refinance their way out of this. And they are not guaranteed to sell their way out either.
