technically and ARM doesnt help you become a home owner. after the 3 to 5 years is up, you have only paid interest on the house, and nothing to the principal.. so unless your house has appreciated drastically in 3 to 5 years, (and in the case of the past year when values have dropped) you are now sitting in a house you dont have any equity in, and cant sell unless you want to sell it for less than what your loan is for.. basically that ARM you have qualifies you as a renter rather than an owner… if appearing as an owner is what makes you happy than enjoy.. you just rented for the last 3 to 5, except when things broke and the grass grew long, you had to fix it or pay for it, rather than a landlord.. might have cost you more to be an “owner.” might as well have rented a house, and let the landlord worry about upkeep for 5 years.. interest only for 5 years can range from 30-60 thousand dollars paid depending on how much house you “bought.” would be nice to own a bit of the house for that kinda money.. sorry i can see how first time owners could be fooled into this, but my 80 something grandmother even kept telling me to make sure my loan wasnt an ARM when we were buying..

Truth: Government should be building roads and protecting our borders. YOU should be reading EVERYTHING before you sign and if you don’t understand something ASK someone or Google it. You should also buy within the confines of your income and should budget for a surplus. (that means you should have enough money set aside for at least a few months lost income)

Also, the “American Dream” is just that…. a dream. The American reality is that you must educate yourself and work hard to get what you want from life. There are no guarantees.

Remember, our Constitution only ensures us the rights to life, liberty and the PURSUIT of happiness.

Oh and one last thing…. WAAAAA! my government didn’t make the mean bad lenders sell me a BIG house for next to nothing!!!!! WAAAAA!

Let’s get back to taking personal responsibilty for our own actions and inactions!

When will rewarding the stupid stop? Our little town is contemplating putting in 76 streetlights on a small strip of highway because three jay-walkers were killed by cars in a two-year period. I’m not saying they should have paid for their offense with their lives, but have they not heard of flashlights or reflective clothing–or waiting till traffic passes?

I’m sick of rewarding stupid people, protecting stupid people and bailing out idiots. Gawd, I hope I’m not becoming a Republican!

–One more person PAYING a mortgage, and paying it off early to save tens of thousands of dollars in interest

You’re ramblings are idiotic and your type of thinking is part of the reason why the economy is the way it is today. You complete generic bashing of all those in an adjustable rate mortgage makes me sick and wonder how you can look at yourself in the mirror. How can you make the blanket comments and assumptions that you do? You dont know any of us or who we are but I guess your qualified to throw the first stone eh? Let me guess, you’re a trust fund baby right?

The government should have been paying attention to all the subprime hooplah going on but was too busy otherwise trying to control oil prices. You want to blame someone for the subprime fiasco why not start with the president and all the mortgage firns and brokers who got rich screwing the people with the allure of an initial low rate and not truly disclosing the potential hazzards of an adjustable rate mortgage or over inflated home values.

Those of us not born with a silver spoon in our mouths simply wanted part in the American dream, to own a home. If you can’t say something nice, then just shut up.

These investors would and still do, sell packages of mortgages to their investors and would make millions of dollars of profit per sale. They are the primary reason for the mess that we’re now in.

The second problem (again, in my opinion) is that people witnessed large profits being made in real estate. So, ‘I can buy this house no matter what the interest rate/terms are and in a few years the property will sharply increase in value. I would say that a lot of defaults/foreclosures are real estate investors.

Thirdly, greedy and sometimes stupid mortgage loan officers, underwriters, lenders and borrowers. I heard ‘I’ll be making far more money next year than this year so I can afford more house. I’m STILL hearing this. People simply want MORE than they can afford. It’s the American Way?

Underwirters get paid on a commission scale. The more they signed off on the more money they made. Lenders were selling EVERYTHING they closed to Wall Street investors so why not lower the underwriting guidelines, close more loans and cash in?

After being in the mortgage business for over ten years I have concluded that people with bad credit almost never change. I would say that 95% with bad credit this year had bad credit 2, 5, 10, etc years ago. There’s a certain percentage of the population that will ALWAYS have bad credit and they have to have a mortgage. They will always pay more for shitty credit and the future is going to be worse.

In conclusion, get your credit score above 720 and keep it there.

- Ron
North Carolina

As far as the sub-prime mess - although I hate “W” - I’m torn on this issue.

On the one hand, those who didn’t read their loan agreements are ignorant and should be punished for said ignorance.

On the other hand, if a large percentage on sub-prime loans go bad, the ripple effect could be (if it isn’t already) very bad for the whole economy.

Obviously all of us who did not lock into ARMS recently and paid the extra fright for a fixed mortgage.

The investors who purchased those bonds based on ARMS (of course they knew there was risk, right? I’m not SO sympathetic for them)

The futures players of those bonds who sold short are truly getting screwed though.

Think about it, they give liquidity to the bond market right? They’re there to take the risk and so we HAVE a bond market.

Now if you were a futures trader, would YOU ever again trust that system?

Oh yeah, this is a mess to be sure.

The reverberations of the market adjusting to this action will be extreme.

The market remembers things like this.

The WORLD MARKET for capital remembers, folks.

And we are a DEBTOR NATION.

tick tock!

They are desperately trying to avert financial melt down, folks.

The fractional banking system can only take so much abuse and the FED kept the rates artificially low too long, and the banking system of checks and balances that might have prevented this was abandoned when REAGAN changed the banking laws.

Remember the Saving and Loan swindle?

This is way worse.