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

To: rich evans who wrote (213901)	8/3/2009 8:52:44 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 306849

Your thinking reflects a hand-to-mouth mentality. You're clearly focused on your low-low monthly payment rather than your financial net worth. He does not find the proposed "easy payment plan" on his $350k mortgage for his own $200k home to be at all attractive. My friend can afford to purchase another $200k home down the street for cash. If these home prices eventually recover their previous highs of $430k, he will have a $230k profit, tax-free - with total equity of $430k. If he keeps his current home, and these homes return to their previous highs of $430k, he would still be $350k in debt with only his original $80k down-payment back, plus $200k taking a wild ride in the stock market, with total equity of $280k. Let's see my friend is 63 years old and he can choose the easy payment plan with a net worth of $280k, or the no payment plan with a $430k net worth. I think he'll find an extra $150k quite useful in his later years. You find the smaller net worth option very appealing. I doubt there are enough people like yourself to make a big difference in the foreclosure rate. .