Commentary
Fifteen years ago, the entire housing sector sunk from its highs. Because so much debt is involved in this market, carried by banks but then bundled without regard to risk and resold in financial markets, this turn of events precipitated a financial crisis that spread around the world. Government and central banks undertook unprecedented actions to save the system with bailouts.
Meanwhile, homeowners around the country found themselves in a strange position of being financially underwater. This happens when monthly mortgage payments are far higher than the existing property values can justify. The test was this: if you could sell your home in the morning and buy it again in the afternoon and make much lower monthly payments, the property is underwater….