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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: Ramsey Su who wrote (54536)	2/23/2006 12:38:48 PM
From: russwinter	Read Replies (3) of 110194

Yes, that's the big question, how many of the regular ARMS types (yellow loans in the First American report) can just refi into 30 year fixed, draw out some equity extraction at the same time to make the extra payment (more Ponzi finance)? That would reset them at somewhat higher rates, and presumably avoid the disaster. The only problem with that, is that a large body (40%, see page 29 First American report) of these folks have no equity if you account for the 5-10% drop in housing prices since last summer. 20% would have negative 10% equity. firstamres.com What kind of appraisals are they using, inflated?

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