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User Info	Paulsen Works With Industry on Loan Plan; entered at 2007-12-01 10:22:37
Mtgspy Posts: 6202 Registered: 2007-10-27	Look it's time to STRAIGHTEN the mind flow a little bit here. Freezing the ARM rates argued some will be good because at least the mortgage will be repaid. DEAD WRONG. Risks in mortgages are divided up among DIFFERENT classes of investor. Some taking interest rate risks, some credit risk, some others that even I have hard time to define. Freezing the rates, IF EVER it works, will kill 90% of the investor in OTHER THAN LONG CREDIT. The prudent guys who paid REAL money to buy insurance will also be raided by being PRUDENT. The guy on Long Interest rate risk is DEAD, many of these are FOREIGN INVESTORS SUPPLYING the BULK of the money in USA. Will it work anyway for the 10%? NO. NEVER. Look at the groups with 20-40% delinquency right now. Look at it. None has reset. WHY? House prices stop going up. House prices are supposed to be 2-3x income when gas prices was A BUCK. This is so people have money to eat. The collateral is tapped out, insufficient. They defaulted because they are UNABLE TO CARRY THE HOUSE IN THE FIRST PLACE FOR GOD'S SAKE. The cure is to wait and do nothing until house prices are sustainable relative to the buyer's income. So if it DOESN'T WORK for ANYONE - WHO THE **** WAS IT SUPPOSED TO HELP, HANK? IT CERTAINLY WILL NET YOU 5 YEARS OF CONTINUOUS LAWSUIT, SO IT'S NOT YOU EITHER. 2007-12-01 10:22:37