The real estate market here in California continues to plunge. One unfortunate dynamic is that there are a large number of houses financed with Pay Option ARMs. Unfortunately, these are actually negative amortization loans – meaning that not only are people losing money on the actual value (or purchase price), but their loan balance is actually increasing. This will provide further downward pressure on the price of homes.
If you are caught in one of these loans, please see the link below.
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