Edward and Maria Moller are worried about losing their house — not now, but in 2013.
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Sandy Huffaker for The New York Times
Edward and Maria Moller and their son, Isaac, at their La Mesa, Calif., home, which was financed with an interest-only loan.
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That is when the suburban San Diego schoolteachers will see their mortgage payments jump, most likely beyond their ability to pay.
Like millions of buyers during the boom, the Mollers leveraged their way into a house they could not otherwise afford by taking out a loan that required them to make only interest payments at first, putting off payments on the principal for several years.
It was a “buy now, pay later” strategy on a grand scale, meant for a market where home prices went only up, and now the bill is starting to come due.
Rest here:
http://www.nytimes.com/2009/09/09/business/09loans.html?_r=1&ref=business
These people appear to be homebuying idiots to me. Why would anyone agree to an interest only loan and why would the lender think that when the principal payments kicked in, the borrowers would not be in trouble?
The journalist seems just as idiotic, describing their current plight in which they can't buy new windows the house, are forced to buy a used car instead of a new one, and shades of horror, can't buy a new flat screen TV.
