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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: GraceZ who wrote (29061)4/3/2005 11:07:24 PM
From: John VosillaRead Replies (1) of 306849
 
My response was that those with little equity wouldn't lose anything since they had nothing invested to lose, it would be the banks which would lose (or those holding the notes). Others, the majority, who have lots of equity invested will continue to live in their homes and pay down their mortgages

True that the banks will lose the most but these consumers foreclosed on will spend much less and be unable to access credit or use their home like an ATM anymore thus hurting the overall local economy. Plus I doubt they'll be making another home purchase for a long time. I would also guess that there is less of a majority with tons of equity in the bubble markets as there were in the 1989 top. Those who bought in outrageously priced bubble markets recently or refied to the max will be slaves to their mortgages for life. I doubt Americans today have the kind of resolve of prior generations and have more obstacles faced than any since the end of the great depression and WWII.
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