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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: MulhollandDrive who wrote (184534)	2/17/2009 10:30:50 PM
From: The Reaper	Read Replies (2) \| Respond to of 306849

To address that, Mr. Obama's plan may require that homeowners eventually pay back the difference between the original payment and the reduced rate. While borrowers would get a lower monthly payment, they would still technically owe a big additional payment at the end of their loan's term. That could be covered by the rise in a home's value, assuming the market recovers. This means either two things... 1) This plan is just going to burn up money because the homeowners are going to default again when they realize that there is never going to be any equity for them in the house. or 2) The government is going to inflate the likes of which we have never seen before in order to make sure there is equity so the homeowners won't walk en masse. I vote for #2 occurring almost with a 100% certainty.