Making sense of the mortgage system collapse

[Black Landlord]

[quote Sam3]Same with the ARM. Maybe I'm weird, but I would think it doesn't take a rocket scientist to figure out that if something is at 5% (as the rates were then), there isn't much room for them to go lower. If something doesn't go lower, it will go up. And anybody who grew up int the 70's would know what interest rates were like then - 16-19%. ARM's weren't offered in such a public fashion back then, now were they?
There were and still are solid reasons to choose an ARM.

[Bill in NC]

What's the downside for foreclosed homeowners in bubbilicious states like CA?

They got to move from a 2 bedroom apartment to a 4 bedroom house for the same amount or less they were paying in rent.

CA is a non-recourse state, so the homeowner can't be held liable for any deficiency when the house is sold (and can live up to a year in their house after they stop making payments)

[Rolando]

I have yet to think of one