I don't think lower rates will do anything. Most of the problem loans don't have the equity or credit scores to be refinanced. If they did, current rates are low enough to make the loans workable. The long term rates are only a point or so off of their lows anyway.
The big issue is that these loans were made with stupid low teaser rates that can't be duplicated no matter how cheap money gets.
 Quote:
Originally Posted by RockOn
One way I can see this coming to a "non-meltdown" end is if mortgage rates would come back down allowing everyone to refi again into low fixed rates. With tight moeny low rates seem to be a ways off. So far, as the Fed cuts rates, mortgage rates have hardly budged, not good.
Even if this would happen, is it really a solution or a bandaide?
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