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February 5, 2009 at 1:18 PM #341872February 5, 2009 at 1:26 PM #341329KilohanaParticipant
I think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
I’m sure lots of folks will enjoy that adjusted lower rate, but only if they still have enough equity to make it worth their while. I don’t think the typical buyer between 2003-present fits this description, though.
Neg Ams, are of course, screwed. Once they hit 100% LTV, it’s game over. Maybe even less than that now.
February 5, 2009 at 1:26 PM #341654KilohanaParticipantI think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
I’m sure lots of folks will enjoy that adjusted lower rate, but only if they still have enough equity to make it worth their while. I don’t think the typical buyer between 2003-present fits this description, though.
Neg Ams, are of course, screwed. Once they hit 100% LTV, it’s game over. Maybe even less than that now.
February 5, 2009 at 1:26 PM #341756KilohanaParticipantI think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
I’m sure lots of folks will enjoy that adjusted lower rate, but only if they still have enough equity to make it worth their while. I don’t think the typical buyer between 2003-present fits this description, though.
Neg Ams, are of course, screwed. Once they hit 100% LTV, it’s game over. Maybe even less than that now.
February 5, 2009 at 1:26 PM #341784KilohanaParticipantI think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
I’m sure lots of folks will enjoy that adjusted lower rate, but only if they still have enough equity to make it worth their while. I don’t think the typical buyer between 2003-present fits this description, though.
Neg Ams, are of course, screwed. Once they hit 100% LTV, it’s game over. Maybe even less than that now.
February 5, 2009 at 1:26 PM #341877KilohanaParticipantI think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
I’m sure lots of folks will enjoy that adjusted lower rate, but only if they still have enough equity to make it worth their while. I don’t think the typical buyer between 2003-present fits this description, though.
Neg Ams, are of course, screwed. Once they hit 100% LTV, it’s game over. Maybe even less than that now.
February 5, 2009 at 1:42 PM #341334barnaby33ParticipantWhen the stimulus package passes, the govt will have to fund it by borrowing. That borrowing will drive rates up. Or the fed can print to buy that debt. That will drive rates up too.
Still nobody, or not enough, will be spending. So prices will continue to fall.
ARM reset rates will most likely respond to this. That massive wave of borrowing will put pressure on interest rates, and still not help fix the problem.
February 5, 2009 at 1:42 PM #341659barnaby33ParticipantWhen the stimulus package passes, the govt will have to fund it by borrowing. That borrowing will drive rates up. Or the fed can print to buy that debt. That will drive rates up too.
Still nobody, or not enough, will be spending. So prices will continue to fall.
ARM reset rates will most likely respond to this. That massive wave of borrowing will put pressure on interest rates, and still not help fix the problem.
February 5, 2009 at 1:42 PM #341761barnaby33ParticipantWhen the stimulus package passes, the govt will have to fund it by borrowing. That borrowing will drive rates up. Or the fed can print to buy that debt. That will drive rates up too.
Still nobody, or not enough, will be spending. So prices will continue to fall.
ARM reset rates will most likely respond to this. That massive wave of borrowing will put pressure on interest rates, and still not help fix the problem.
February 5, 2009 at 1:42 PM #341789barnaby33ParticipantWhen the stimulus package passes, the govt will have to fund it by borrowing. That borrowing will drive rates up. Or the fed can print to buy that debt. That will drive rates up too.
Still nobody, or not enough, will be spending. So prices will continue to fall.
ARM reset rates will most likely respond to this. That massive wave of borrowing will put pressure on interest rates, and still not help fix the problem.
February 5, 2009 at 1:42 PM #341882barnaby33ParticipantWhen the stimulus package passes, the govt will have to fund it by borrowing. That borrowing will drive rates up. Or the fed can print to buy that debt. That will drive rates up too.
Still nobody, or not enough, will be spending. So prices will continue to fall.
ARM reset rates will most likely respond to this. That massive wave of borrowing will put pressure on interest rates, and still not help fix the problem.
February 5, 2009 at 1:57 PM #341354sdnerdParticipant[quote=Kilohana]I think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
[/quote]I believe the price your neighbors house sold for is mostly irrelevant to the vast majority of people out there.
All they care about is the monthly cost. How much do I owe this month? That, and in most cases their house is “different” of course.
If your mortgage is at or cheaper then comparable rent – why would they bail? Until they actually have to pay more, or simply cannot afford the current rate.
Of course there are reasons it would still make sense to bail now. All I’m suggesting is, I don’t see a huge tidal wive of people walking just because their ARMs are adjusting this year. Or next. Long, drawn out process with inflation eventually kicking in is what I’m envisioning right now.
February 5, 2009 at 1:57 PM #341679sdnerdParticipant[quote=Kilohana]I think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
[/quote]I believe the price your neighbors house sold for is mostly irrelevant to the vast majority of people out there.
All they care about is the monthly cost. How much do I owe this month? That, and in most cases their house is “different” of course.
If your mortgage is at or cheaper then comparable rent – why would they bail? Until they actually have to pay more, or simply cannot afford the current rate.
Of course there are reasons it would still make sense to bail now. All I’m suggesting is, I don’t see a huge tidal wive of people walking just because their ARMs are adjusting this year. Or next. Long, drawn out process with inflation eventually kicking in is what I’m envisioning right now.
February 5, 2009 at 1:57 PM #341781sdnerdParticipant[quote=Kilohana]I think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
[/quote]I believe the price your neighbors house sold for is mostly irrelevant to the vast majority of people out there.
All they care about is the monthly cost. How much do I owe this month? That, and in most cases their house is “different” of course.
If your mortgage is at or cheaper then comparable rent – why would they bail? Until they actually have to pay more, or simply cannot afford the current rate.
Of course there are reasons it would still make sense to bail now. All I’m suggesting is, I don’t see a huge tidal wive of people walking just because their ARMs are adjusting this year. Or next. Long, drawn out process with inflation eventually kicking in is what I’m envisioning right now.
February 5, 2009 at 1:57 PM #341809sdnerdParticipant[quote=Kilohana]I think the point is that even IF your ARM does adjust lower, when you find yourself owing $1m on a home worth $500k, you start to question whether or not you should even be there. Saving a few hundred dollars a month doesn’t help the math along when you’re up against those numbers. The house would have to really be something special, I think. I can’t imagine seeing a model match at 50% off and thinking anything other than “BAIL!”
[/quote]I believe the price your neighbors house sold for is mostly irrelevant to the vast majority of people out there.
All they care about is the monthly cost. How much do I owe this month? That, and in most cases their house is “different” of course.
If your mortgage is at or cheaper then comparable rent – why would they bail? Until they actually have to pay more, or simply cannot afford the current rate.
Of course there are reasons it would still make sense to bail now. All I’m suggesting is, I don’t see a huge tidal wive of people walking just because their ARMs are adjusting this year. Or next. Long, drawn out process with inflation eventually kicking in is what I’m envisioning right now.
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