3 years ago, the husband and I took the plunge and bought a house.  It was 2005, and housing was booming.  Lenders were willing to loan ridiculous amounts of money.  In fact, they scoffed at the “modest” amount of money the husband and I requested.  They offered to loan us twice as much, but we declined; we knew how much money we made, we knew how much other debt we had, and we knew what kind of lifestyle we wanted to maintain.

And so we got a loan we could afford.  We took a risk with an ARM, but even in a worst-case scenario, we knew we’d be able to afford the payments.

Silly us!  If we had over-extended ourselves, we’d be able to renegotiate our loan terms.  Instead of being stuck with a loan for twice as much as what our foreclosing neighbor is selling her house for, we might be able to get our principal reduced.  Or get our ARM converted to a standard loan.

But, alas, we were responsible.  And so there is no help for us.