Cash Will Be King With Continued Housing Decline!

Beginning in July of 2009, until the peak in August of 2011, there will be up to 5 million home loans that will be resetting due to the terms of the loan.  The "Option ARM" segment of these resetting loans will be resetting at higher loan amounts and shorter terms, as well as inevitably higher loan to values due to the global devaluation of real estate values, and higher interest rates, either of which will preclude a refinance option.

The higher loan amounts will be due to the negative amortization that has been accruing and the likelihood of unpaid property taxes that will be added to the principal balance when the loan resets. The shorter terms will be attributed to the type of the loan: either a 5/1, 7/1 or 10/1 where the loan payment was fixed for the first 5, 7 or 10 years of the loan and then will "recast" at the new loan amount amortized over the balance of the remaining term of the loan e.g. 25 years, 23 years or 20 years.  The higher loan to values are due to the prior worldwide financial disaster that wiped out 30% to 50% of the real estate markets value, as well as the continued decline in the market by way of the resetting loans charted above.  Additionally, interest rates have been kept artificially low and must go up to pay for the Trillions of dollars in debt that the U.S. government has incurred in its effort to stop the real estate crash.

Consequently, the biggest wave of foreclosures ever known is welling up on the horizon. The only answer is to get to high ground (sell all of your real estate holdings) as quickly as possible, and save your money (rent) for the next 3 to 4 years while you wait for the real estate market to hit bottom.  When that time comes "Cash will be King" and what you will be able to buy real estate for at that time will blow your mind.  For a blueprint on how to take advantage of the opportunities to come, and make hundreds of thousands, if not millions of dollars, go to www.CashWillBeKing.com.