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Hi MT,
I came across a story in the LA Times(12/28/07 business section)
"Defaults moving beyond sub-prime"
People with good credit got into pay option ARMs (option to pay less than interest) this made up about 9% of total mortgage volume last year in the US. California, Florida,and Nevada were the big states. If the story is true the real estate market may take years, not months to hit bottom.
regards,
Brian
Posted by: Brian Poncelet, CFP | December 28, 2007 at 12:39 PM
Hi Brian, You're right in that no one really knows how long it will take for the U.S. real estate market to bottom. Most seem to agree that it will take at least 2-3 more quarters for the worst to pass. However, the total correction could take a lot longer. Here's an interesting chart that shows how inflated prices have become south of the border. Melanie
Posted by: Mortgage Broker | December 29, 2007 at 01:15 PM