Posted on 05/10/2010 3:58:51 PM PDT by grand wazoo
Investigations of what, bank fraud?
Personally, I don’t feel obligated to explain anything to you.
Or to prove your claims either. Run away.
Ok...let’s just agree to disagree. How’s that?
You tend to pull comments/snippets from a larger article and argue the comments out of context while ignoring the major points of the article.
They can't (ARM resets could result in higher monthly mortgage payments), not when the index keeps falling.
Yes they can.
If the ARM starts out with an interest rate that is far below (ie teaser rate) what it will adjust to, then an ARM reset may increase the monthly payment substantially (regardless of the current dip in most index rates). The argument was made that 3 or 5 years later, a person should be making enough money to cover the additional mortgage cost and if they didn't, they could always sell the house at a profit, because real estate never loses value.
There has to be a reason that such large numbers of people are defaulting on their mortgages.
I think it's because they stopped making payments.
Yes of course, that is called defaulting on a mortgage. But what is the reason why people stop making payments?
Besides the few who are "walking away" many/most people are defaulting because they cannot keep up with the monthly payments due to increases in interest, taxes, and utilities which they cannot afford. Their increased salaries have not been substantial enough to cover the additional costs of the mortgage, utilities, and other assorted debt liabilities.
I didn't realize I had to comment on every one of the 420 words you clipped.
and argue the comments out of context while ignoring the major points of the article.
Maybe you need to pay closer attention to my comments?
They can't (ARM resets could result in higher monthly mortgage payments), not when the index keeps falling.
Yes they can.
We're not talking about a long term rise in an index with a recent drop. We're talking about indexes that have been dropping for 2, 3, 4 years.
If you have an index that's higher today than 2 or 3 years ago, I'd like to see it.
This rate shock can be even greater if you have a hybrid ARM. These mortgages have a low initial rate that stays fixed for a set period
Yes, these are more likely to go up than the plain vanilla ARMs.
See how I agreed that these rates are more likely to go up (but probably with the long term drop in most indexes, will still drop) than a plain vanilla ARM?
You could have a different kind of reset problem if you've been making the lowest allowable payment on an option ARM.
Yup, these ones too.
Darn, I did it again.
Yes of course, that is called defaulting on a mortgage. But what is the reason why people stop making payments?
Lots of reasons. Job loss, strategic default, etc etc.
Besides the few who are "walking away" many/most people are defaulting because they cannot keep up with the monthly payments due to increases in interest, taxes, and utilities which they cannot afford.
Probably few defaults are due to decreases in interest.
I’m not writing this because I happen to agree with you. Nor, am I writing this because you are a Frank Zappa fan.
The dilemma we are in now can only be counter-acted by *pollination* of information.
Set aside the social components of the various arguments and focus on the LAW.
If a borrower commits a crime in the act of borrowing, said borrower should be held accountable.
If a lender commits crimes in the act of lending, said lender should be held accountable.
You would make for a wonderful contributor to our site comprised solely of volunteers.
Please accept my invitation to join.
http://www.foreclosurehamlet.org
As an example of what Grand Wazoo just described..
“I didn’t realize”
That seems to be your specialty.
And your specialty is posting stuff from DailyKos. LOL!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.