Spring has sprung and the weather has warmed up, but the jittery times in which we live persist.
Home prices are declining precipitously and foreclosures continue to rise, the weekend before last teachers began receiving layoff notices, the city of Vallejo is teetering on the verge of bankruptcy, and the list goes on.
Unfortunately, none of these problems is going to get fixed any too quickly. It took a lot of bad decisions by individuals and public office holders to make the messes, and it’s going to take years to get out of them.
As a divorce lawyer, I see a lot of home mortgage statements. They tell the tale of why the real estate market is in the tank. The mortgage of choice for too many home buyers has been one with four payment options: the highest, which pays off the loan in 15 years, slightly lower, which pays it off in 30 years, interest only, and minimum. Also, these loans come with adjustable interest rates.
To make matters worse, lenders were often making these loans in an amount equal to the full appraised value of the property.
Read more at InsideBayArea.com