Today I read an article in the paper, that the FHA might implode. Ouch. I have come to the conclusion that there is an "all cash" market, an FHA market, and then a whole lot of nothing.
I had a conversation with a fellow agent about a year ago, and we both came to the same realization: if people have more money invested in their car than their home, it seems to be a prescription for disaster.
We both figured that a year or two down the line, alot of these FHA borrowers were going to walk away from the houses. It is starting to happen now, according to the article in the Contra Costa Times.
I hope this isn't the end of the line for a housing market that is just starting to show signs of life, after lying dormant in the dirt for a couple of years.
I repeat: OUCH.
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