is to ask if you had enough to pay all cash would you??

I doubt very many of today's buyers would pay all cash even if they
could. the fact that they can take an enormous mortgage and then
walk away if the price drops is, I believe, a major reason for the
bubble.

--
billb
Do not squander time, that is the stuff life is made of.
The war is over, don't ask for credit.

In a bull housing market, those low-down 1-year-adjustable mortages
are equivalent to stock options, high leverage gambling.

Not anymore. Compare ARMs and 30/15yr fixed rates

a

If you got in 5 years ago you probably have doubled your value. If you
get in now you probably will lose 20%. So interest only loans will fall
by the wayside and mortg. companies will tighten their requirements.
Cash or mortgage doesn`t seem like a good buy to me at this time.

Yep. Rent and save the difference and wait for the eventual pull
back. Rentals fell cuz so many ran to buy.

If new houses fall so will resales. Resale prices are usually 10 to
20% less than new.

a

aubrey wrote:
Why would I fear falling property values if I have no equity? Doesn't
an interest only loan give me the same economic interest in housing
prices staying up as a renter--none?

??? What? If you buy a house for 250,000.00 and pay interest only ot
interest and principle, and the market drops to say 200,000.00 and you
sell the house for 200,000.00 then you will owe the mortgage company
50,000.00, if your renting and only if your rent will you owe nothing
but the rent.

Ok, but what if I just stop paying the mortgage and let them foreclose?

You are still liable for the money and they will take every thing you
have and attach your wages and bank accounts ect.

Foreclosure laws vary from state to state, but in general banks have
no desire to "take everything you have, attach your wages", etc., even
if they have the actual legal right after they auction your foreclosed
house on the courthouse steps.

You can almost always reach an agreement with the bank
such as "deed in lieu of forclosure" where you just give them
the house without foreclosure and they give up any claims
against you.

---
William Ernest Reid
Post count: 9

I think this is the best way to do...

Hi,

Mortgage is also the best way for buyers.

Yes it use to be people would pay cash, and that's when prices were reasonable. Seems to be that the types of creative mortgages today just push prices too far out of reality.

These irresponsible thoughts of buying something one can't afford are what got us in the problem.

Yes. This is definitely the best way.