[Nubbin]

Instead of settling for the affordable 3-bedroom ranch house that would allow them to still make payments if one of them were to lose their jobs, they go for the much more expensive 4-bedroom colonial

I'm amazed at the size of the houses I'm seeing built in my area. I live in a small community, therefore I know where these people work and about how much income they have. I have to wonder how in the world they can expect to afford their mortgages which has to be over half their income.

[SamAdams76]

Don't forget that most people who overextend themselves financing these large homes also finance their cars as well. And they aren't settling for a Ford Focus or a Nissan Altima either. It's usually got to be a Lexus or an expensive SUV for these people. A recipe for disaster. These people only "rent" their lifestyles. They are just a paycheck or two away from financial ruin.

[hinckley buzzard]

You put your finger on one measure of how serious this problem is becoming--the percentage of mortgages that require more than 50% of income to make payments. This too is at an all-time high.

With such low interest rates, imprudent borrowers get themselves in way too deep, and together with other ballooning installment debt, lose control of their finances.

While there are banks and finance companies which will approve crazy loans, no one ever yet forced a customer to borrow too much money.