Not in my hood' either. And we have a couple of foreclosures. But what is wrong with a price decline. We buy stocks, and they go down. We buy bonds (bond funds) and they go down, why not the house. Isn't it really the down side of volatility we are upset about. My house is not an investment, but I would like to know that I am getting a return that is slightly greater than inflation over the holding period. For the last five years I have been the recipient of extremely nice appreciation - so much so that my house could lose 25-30% in value and I would still claim it to be an absolutely outstanding investment to the tune of 10% annualized. If I had bought Google at 400, saw it rise to 747.20 and now it is down to 632.50, I would be sad - it is a paper loss. But I would not expect some one come bail me out!!! Read as Group 1 - House Flipper!Now I realize for some folks this is not a paper loss - it is real. And I know first hand how that feels as I purchased a home in Phoenix circa 1980. I did what I could to buy that house, and I would have taken a teaser rate - back then it was called a three-two-one buy down. But again I have the wisdom of years - and a few down markets to let me know - Real Estate does not always go up. So, If I had bought 1000 shares of Google on margin at 747.20 and again we are down to 632.50 - Well, It is time for me to pay the piper - no bail out! If they were smart enough to think about taking a teaser rate and refinancing later - because miraculously their house was 50% more or they would be making 50% more income - then Group 2 - Gaming the System -ers - You were an idiot! It is time for you to pay.So, what about group 3Taken advantage of? Well that is hard to prove, so now we can look at some regulation (which I hate as a solution) or perhaps market discipline which seems to be a bit better now! But with the announcement today of another write down, I think the investors are paying. And another story I saw shows the impact of firing the CEO's who headed this mess is going to cost some companies.I am all for helping out those who want to and can demostrate the resonsibility to stay in the home. Fix the rate, give up a portion of equity, stay the foreclosure process if requirements are met - Beyond that - Well, taken advantage of or not - if they can not afford the house, downsize!!!! You made a bad bet!
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