Negative Amortization
Video:
The speaker suggests that the next wave of monetary system failure will be in the Option ARM and Alt-A loan market. He suggests that this market will suffer more defaults than the sub-prime market has already suffered.
Video:
The speaker provides an explanation of what a negative amortization loan is. He mentions that they keep your monthly payments low by increasing your outstanding loan balance up to maximum limit. These loans are commonly referred to as
A negative amortization loan is a type of loan which lowers monthly payments below the amount required to cover the costs associated with that loan. Borrowers will get involved with a negative am loan for one of two reasons; they lack the funds to make the monthly payments using traditional mortgages or they have an expectation that home prices will substantially apprec
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