Exotic mortgages, payments Skyrocket

Then the outskirts of San Diego to become a teacher guides the payments will be directly, probably through their ability to pay. Unable to perform Translation:invalid textLike millions of buyers during the boom, Moller to leverage their way into a house that is otherwise not taking a loan that is asked of them, only paying interest on the first push payments over several years to make the power important. Unable to perform Translation:invalid textIt 'been a "Buy now, pay later" strategy on a large scale, aimed at a market where home prices rose, the price alone, and now the bill begins to run. Unable to perform Translation:invalid textWith many of these houses under water - less than the loans against them - the interests of many mortgages that will soon be unsustainable, as homeowners begin to pay are very important. The monthly payments can jump up to 75 percent. Unable to perform Translation:invalid textMoller have much more their home is worth, and have few options if they are already anticipating the sentence. Unable to perform Translation:invalid text"I pray for another boom," said Moeller, 34 "Otherwise, we must walk. Unable to perform Translation:invalid textKeith Gumbinger, an analyst at HSH Associates, said: "This is the source of the problems of tomorrow. Borrowers would have thought that the loans were safe, but it seems that also share the house." Unable to perform Translation:invalid textAfter three years, is brutal, and more proof that the goods had crossed a watershed. Sales in July were the highest in a year, and August is proof that he was better. In almost all major cities, house prices are currently increasing. Unable to perform Translation:invalid textCelebration, however, might be premature. The fate of Moller and many others in similar situations are likely to weigh potential years of recovery ahead. Unable to perform Translation:invalid textExperts predict a steady drum breakdowns in many parts of the next decade, this interest for the loans to maturity. Auction at low prices, these foreclosed homes could help curb a rise in prices of goods. Unable to perform Translation:invalid textInterest loans are not the only kinds of exotic mortgages that weighs on the housing market. Another big problem is that homeowners with the opportunity to "pay" loans, in many of these loans are essential goods actually increased over time. Unable to perform Translation:invalid textHowever, loans are a particular problem. An analysis by The New York Times by an American company in building first CoreLogic shows that there are 2.8 million active-interest loans only at home for a total of U.S. 908 billion U.S. dollars. Unable to perform Translation:invalid textThe periods of interest only to discourage the payment of capital for five, seven or 10 years from now. Over the next 12 months, you are betting $ 71 billion in loans alone. The following year, another 100 billion dollars will be reset. Set back from the middle of 400 other 2.011 billion. Unable to perform Translation:invalid textJohn Karevoll, a senior analyst longtime MDA DataQuick, sees the situation of owners of interest in this way: "You are heading directly to a wall and can not be stopped." Unable to perform Translation:invalid textThe longer the interest only period, the years the owners have hopes of a recovery, government assistance or a miracle. But long-term interest as time is against them. A loan that is interest only for the first 10 years, the house is paid within the next 20 years are typical and not 30 years. Unable to perform Translation:invalid textStart A possible solution: you pay more each month to pay the principal hours before restoration of the loan. But many homeowners have taken the most qualified for this and can not afford to pay more, or at least not enough to reduce significantly the most important. Unable to perform Translation:invalid textTen years ago, only low-interest loans were rare. But as the boom heated and desperately seeking a buyer could use these loans were omnipresent. They were especially popular in Florida, Nevada, and particularly in California. In 2004, nearly half of all buyers entered in the state. Unable to perform Translation:invalid textMoller bought in 2005 a payment of $ 460,000 for three bedrooms, a walk home Square Mile. A guide to refinance a few months later is required to pay in cash, debt. Now the house is worth about $ 310,000. After their only interest until it is expected that their monthly payments increase by 20 percent or more.