Quote:
Originally Posted by Pinner
Exactly, people are so concerned how much their house is worth but it really makes no difference unless your getting into or out of the market.
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Hmmm wouldn't a downward trend in prices have a larger effect if you're looking to move up to a larger more expensive house (in absolute dollars.) Though I guess that assumes everything is affected equally on a percentage basis . . .
While I agree with the sentiment, I think many people say that but don't actually think that house prices can actually come down. I know people pushed to the brink by houses they couldn't really afford in the first place. If prices go down and they get underwater (some of these out there already from 2007/8) . . . buying a new house is the least of their worries. Knowing that you couldn't even cover your debt obligation by selling the house can start a nasty little cascade of shenanigans. And nevermind the sidebar of people borrowing on house backed lines of credit based on disappearing equity.
Speaking of which, anybody ever find out what happens when you are (badly) underwater and your mortgage renewal comes up? I assume the current bank would still roll it over but you'd be hard pressed to find another bank to take the loan. You'd probably get screwed hard with a poor rate?