Underwater Homeowners are Still Looking for a Lifeline

(from the Scotsman Guide)

The housing crisis seemed to start overnight in many parts of the country, going from good sales in December 2006 to no sales abruptly a few months later, when the bottom started to fall out.

Many of those most affected by the crisis were elderly underwater homeowners who got into trouble after pursuing refinances that were often done for the purpose of helping their kids. Although the elderly are commonly more cautious when it comes to home financing, a large number mortgaged their homes with risky interest-only first and second loans — convinced by their lenders or their own children that these loans would be paid back with escalating equity fueled by rising home appreciation.

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