I read a blog that used to point out histories of defaulting house mortgages. That is, they'd take a mortgage that was in default, and look at it's history. He never seemed to be short of examples of people who were having their house revalued up each year, and taking that extra value out as cash.
Each year, some of these house owners were taking an extra 50-100 thousand dollars out of their mortgage to support their lifestyle.
When the housing market crashed, they were well underwater. But not only that, they needed to figure out how to live on a hundred K a year less than they've been spending even if they don't lose their jobs.
I just don't understand the mind-set where that seemed like a good idea.
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Date: 2011-09-11 06:30 am (UTC)Each year, some of these house owners were taking an extra 50-100 thousand dollars out of their mortgage to support their lifestyle.
When the housing market crashed, they were well underwater. But not only that, they needed to figure out how to live on a hundred K a year less than they've been spending even if they don't lose their jobs.
I just don't understand the mind-set where that seemed like a good idea.