Option ARMS Are the Real Culprit for Real Estate Collapse

Forget blaming sub prime loans for today’s real estate disasters.According to Randall Forsyth, editor of The Baron’s Online,the real culprit for the current real estate mortgage mess are actually Option ARMS.

Forget blaming sub prime loans for today’s real estate disasters.

According to Randall Forsyth, editor of The Baron’s Online,  the real culprit for the current real estate mortgage mess are actually such prime loans as Option ARMS.

What are option ARM’s?

You could kind of choose what you wanted to pay on your mortgage every month.

If you didn’t want to pay on your principal or your interests, you could  simply add all of those expenses onto the end of your mortgage.

"The day of reckoning has finally arrived," Forsyth says.

 

 

 

 

 

Baron’s projections are 29 billion in 2009 and 67 billion in 2010. 

 

But all this reminds me of a documentary I saw last night about The Stock Market Crash of 1929.  I was amazed at how similar it was to what we’ve just been through in the last few weeks.  Real estate, especially  real estate in Florida was booming, and then it went bust almost at once. 

 

There are plenty of lessons for us to learn.  The best place to go right now is history.  The Donald does that and if it’s good enough for him, I think it will work for us. 

 

One thing to keep in mind.  Some people managed to make a lot of money then, and that will happen now- but you have to on top of the game.   

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