Once again, the WSJ has found another example of mortgage madness that is hurting us all. Without any irony at all, they introduce us to a couple with a combined $70,000 in income who managed to borrow $637,288 for their home. Ain't America Great!
"Nanci Puerto, a 40-year-old house cleaner in Antioch, ran into such a problem. She refinanced her house for $637,288 from IndyMac in 2006, taking out cash for a down payment on another property. She and her husband, who works in a machine shop, take home a combined $70,000 a year. Each month, she makes the minimum payment on her loan, $2,416. At the same time, she watches the outstanding principal swell since that payment doesn't fully cover the interest costs. Now she owes IndyMac $707,000, on a house that the county tax assessor says is only worth $410,000." http://online.wsj.com/article/SB122548504641688959.html