Here is the crappy thing. Many people took out interest only arm's as a gamble thinking in 3-5 years their house value would increase 50-100 thousand and they would sell and cash in. They new what they were doing, took a gamble, got spanked and now we are all paying the price for it. I was working in a new development in Hingham once. The houses were decent colonials. I asked the guy running the show how much they were going for? He told me $700 + , I said to him who the hell can afford that? He said alot of young couples taking interest only ARM's for 5 years, banking that the value would go up and then they would sell. Many of them lost their shirts.
The banks took a gamble and also lost. Now we are bailing them all out. I lost thousands on a stock, do you think the gov. would bail me out and give me some coin.
