"Ed Huntress" wrote:

It never happened before. If they had asked their banker, or anyone else who
follows it, what the chances were they'd be upside-down on their mortgage in
a year or two or three, making it impossible for them to flip their house
and come out ahead if the mortgage became too much for them, the bankers
would have laughed in their faces. The experts "knew" that it couldn't
happen, because it has never happened before.


Ed, anyone that finances a car should know the dangeors of being upside
down. Say you buy your new wizbang 4000 and it gets creamed coming off the
lot. Most insurance companies are going to want to pay off on what it is
worth vs what you paid.

A less dramatic example is that you drive your wizbang 4000, 30,000 miles a
year. Long before you make your 5 years of payments you are seriously
upside down since vehicle values are set by a combination of miles and
condition.

Should we blame the bank for loaning money on a vehicle that decreases in
value quicker than the amortization schedule?

Wes
--
"Additionally as a security officer, I carry a gun to protect
government officials but my life isn't worth protecting at home
in their eyes." Dick Anthony Heller