Michael Rosenwald: Was My Mortgage A Mistake?

Staff writer Michael Rosenwald wrote about his mortgage worries in last Sunday's paper. He tells us whether he would do it all again and take out an interest-only loan on WTWP radio. Listen here.

By Dan Beyers  |  August 22, 2007; 11:41 AM ET
Previous: Early Briefing 08.22.07 | Next: Thomas Heath On The Radio

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No one was predicting this? Was he not reading the financial pages he contributed to? LOTS of people were predicting this, as the rise in home values outstripped the rise in incomes by an alarming amount.
Hindsight may be 20/20, but a little prudent foresight when you're making the most important purchase of your life is a lot closer to 20/20 than the follow-the-self-deluded pack mentality Rosenwald chose to follow.

And as a financial writer, he maybe should have mentioned the biggest problem with his "great rate" interest-only loan - if you don't make enough principal payments and home prices stagnate, you end up owing the bank even if you are able to sell for "a little more" than you bought for. Fees and other transaction costs will eat up any profit you have.

Very happy to have my 5.25% 30 year fixed that I re-financd in 2005. But then, I always had at least 20% equity in the home.

Posted by: NotAMom | August 23, 2007 7:52 AM

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