Bubble, Bubble, Toil and Trouble
Bubble talk may not be just a bunch of froth
-- Mortgage gambling: A record number of people -- more than 70 percent in the Bay Area and 31 percent nationwide in 2004 -- are buying real estate with interest-only adjustable loans. What's scarier, mortgage lenders have sold many home buyers negative-amortization loans -- in which homeowners pay less than the interest due and therefore go deeper into debt every year. According to Fitch Ratings, loans with negative amortization accounted for 5 percent of the nation's home loans in 2004.We haven't got to the point reached by the Japanese - 100 year multi-generational mortgages. Yet.