for 3 or 5 years though. That's part of the terms. Nothing outside of that was promised to them on paper.
It's reasonable to expect someone looking at a 5/1 ARM or an 'Interest only for X years' loan to ask "What can I be guaranteed in writing will happen at the end of that period?" The right answer was "Nothing. Interest rates have historically moved between 3% and 22%. Your new payment could be 4x your old rent, or it could get even cheaper. The value of the home could go up or it could go down. By taking this loan you are betting your house, the down payment, and your credit rating on not just one but multiple assumptions: Low rates and continuing appreciation."
That's setting aside the systemic risks that I agree nobody not in the financial world ought to have been expected to understand.
for 3 or 5 years though. That's part of the terms. Nothing outside of that was promised to them on paper.
It's reasonable to expect someone looking at a 5/1 ARM or an 'Interest only for X years' loan to ask "What can I be guaranteed in writing will happen at the end of that period?" The right answer was "Nothing. Interest rates have historically moved between 3% and 22%. Your new payment could be 4x your old rent, or it could get even cheaper. The value of the home could go up or it could go down. By taking this loan you are betting your house, the down payment, and your credit rating on not just one but multiple assumptions: Low rates and continuing appreciation."
That's setting aside the systemic risks that I agree nobody not in the financial world ought to have been expected to understand.