Catholic Info
Traditional Catholic Faith => The Greater Depression - Chapter I => Topic started by: Matthew on January 14, 2008, 09:44:04 AM
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As a Loan Officer for a bank I kept thinking it was insane for our bank to keep making zero down loans to investors. It seemed everyone was trying to buy an investment property with zero cash. I had one customer, a hairdresser, who bought 4 properties all zero down, no income verification. In almost every case, the rental income these investors are making is not enough to cover the PITI payment. I would point this out to them but they had to get in on the Gold Rush too.
I now am seeing groups of rental houses listed for sale all advertizing "short sale".
One guy who was my customer owned 3 townhouses in Scottsdale all rented with a $1,200 per month loss. He told me he didn't care about the rental losses when the property was appreciating at $3,000+ per month.
Take it from me-- a bank insider-- there are thousands of Casey Serins out there. Most have decent paying jobs, savings, and 750 credit scores. They have covered the monthly negative cash flow so far; hoping and praying the market turns back around and they can just break even. Eventually, it will eat away their savings, eat away their will, and they will realize it's easier to walk away too.
STAY TUNED, YOU HAVEN"T SEEN ANYTHING YET!