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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (74685)	11/28/2007 5:08:45 AM
From: JDN	Read Replies (2) \| Respond to of 77400

Well, as I understand it besides the banking problem there are every increasing foreclosures which are driving down the used housing market considerably. Most people dont buy a new home without first selling their old one (I was the opposite and I am PAYING THE PRICE for my stupidity now), thus the Construction industry is taking it on the chin also. Since so many industries feed into the construction industry there is the danger that this could cause an economic ripple thoughout leading to a recession. Thats where everyone takes it on the chin. What I dont quite understand is rather then force a foreclosure (which its been my experience in banking leads ultimately to the bank losing money) why dont they just rework those loans and rather then jump the interest rate up above the individuals ability to pay, accept a reasonable lesser rate for a few years till this works itself out? Because I have not been able to sell my old home I am having to take out a mortgage on my new one (previous to this I had no debt). I have elected to go with a 3 yr. ARM at 6% interest only, thinking SURELY I can sell my old house in THREE YEARS. Now, I can get a 5 year ARM for 6.125% (about $50 a month more in payment). Anyone care to comment on whether I should switch to 5 years from 3 years. My bank says I can make that decision up to about a week before loan closing (1/7/08). jdn