Hacker Connect January 16 in New York
An event for and by the real estate tech community

Adjustable-rate mortgages with interest-only options have driven much of the buying activity over the last five years. With a slowing market, some owners may find that they owe more than their property is worth. In 2007, approximately 9 million adjustable-rate mortgages (ARMs) will readjust. Combined with a flattening or decrease in prices, many owners will be caught in the squeeze of having higher payments and no way to pay for them. In 2001, only 2 percent of the ARMs were interest-only, while today more than 35 percent are of this type of loan. San Diego has the most dangerous track record in this respect. In 2006, a whopping 47 percent of the purchasers used an interest-only product. This means that these properties have no equity. Assuming a 6 percent commission and 2 percent in add...