Quote:
Originally Posted by UFO
Well its pretty obvious... current rates at a conservative 4%, if it balloons to 25% it doesn't take a genius to figure out that there will be LOTS of people in trouble. It won't get to 25%, not before hitting 6%, 10%, 15%, and the question is which step will get most people into trouble. Even a jump to something like 8%, there will be lots of people in trouble given how so many jumped on the bandwagon when credit was cheap. The highest mortgage rate I recall was in the 80's when it hit ~18%, but people were able to get through that ok, however people were arguably more responsible with their money back then.
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He didn't mean 25% interest rates, he meant go up by 25%, I.e. from 4% to 5%, a 1% rate increase will be a huge, huge hit to the majority of people in this city