Upside Down Mortgage

Subprime Real Estate

Question: Govt proposing Freeze on Subprime Interest rates is it Fair or not to all Mortgage holders and who should pay?

Keep in mind while we blame the Banks who gave the loans to bad credit holders, our Govt told them to "Get low income and all first time home owners in their FIRST HOMES". Also, keep in mind, that the people applying for these loans KNEW their loans "may" go up and YES the mortgage lenders do explain this to you, as the home owners try to play "dumb" now.

Keep in mind, many people combined high credit card balances, car loans and got every extra on the new homes they could knowing it was low interest loans on their new home and now that the rates are up "Ut oh" and now expect the govt to bail them out.

In New home developments, the real estate personnel who do pre-approvals know who can't afford all the "extras" on the new homes, yet went ahead on their "low interest" loans, knowing they would reap the benefit of their commission, of course the end result is the home owner knows they eventually have to pay for these extras.

Answer: I don't think that the government should bail anyone out in this mess. The mortgage companies knew that they were taking a huge risk when they gave loan to people that were high credit risk. The people who took them knew exactly what they were getting into. They knew that their rates were going to increase and that was going to make their payments go up--any idiot would know that. This is a classic case of people trying to keep up with the Jone's. People choose to leave beyond their means and then expect the tax payers to bail them out. Most people who got these flexible rate mortgages could not even pay rent and were constantly being evicted from homes because of that, and yet they thought that they were responsible enough to own a house. I think that they deserve to lose their homes...sorry about your luck and start paying your bills. When my husband and I bought our house, we agreed that we would only do so with a fixed rate loan which we got and that we would buy a house that we could afford if one of us lost our jobs or there were other problems. We were approved for 175,000 loan and the house we ended up buying was a 110,000 which saved us quite a bit on our monthly payments.

Real Estate Woes: Subprime Mortgages Are a Ticking Timebomb

If you're new around here, you might want to subscribe to our Upside-Down Mortgage RSS feed. It's quite likely the only feed of it's type on the internet!