Wells Fargo had a negative amortization loan called Pick-A-Pay
You picked your payment every month- want to pay $1? Ok – the additional interest was just added onto your loan amount.
This worked OK when a properties value was going up 10% every month.
When the bubble broke so did this loan program.
I remember one loan officer I respect telling me he did everything he could to steer clients away from the Pick-A-Pay program.
Well, California’s Attorney General just reached an agreement with Wells to modify $2.4 billion in Pick-A-Pay mortgages!
See more here at the Wall Street Journal…
Barry Bevis, Broker/Realtor