The result is you pay down your principal much more quickly, but still have the "escape hatch" of a capped rate and/or the ability to convert your variable mortgage into a fixed if rates start to rise quickly enough to spook you.

I develop lots so I know it cost even in your market at least 20k to development plus the land.. in our market in OR its 35 to 50k per lot to develop themI tried like a mad man to raise capital to buy thousands of them.But investors were still spooked and or they would say WE ONLY BUY CASH flow we don't care about appreciation..

That spooked me from doing another one for several years, until my current "buy-and-hold" that tripled.

I was born in Ukraine and lived in orphanages around Ukraine and Russia.

This deal has me spooked because it seems so odd to let a home get foreclosed on with 400k in equity.

I have seen many situations  - especially where tenants are involved -  that they do not want realtors and potential buyers going through the buildings for several different reasons - some are afraid to spook their tenants in case the property doesn't sell fast and they get stuck with vacancies - they may not want to disturb their tenants - or don't want people going through there unless they know they are serious.

Originally a refugee from Ukraine, I've lived in Louisville, Kentucky 19 out of the last 22 years, with the three other years spent in wonderful Washington, DC. 

We are spooked by prices here in Orange County CA, but I am not opposed to looking in other areas or even states, but both prospects are intimidating, and I feel like we are poised on another bubble at the moment.  

GreetingsPhiladelphia native, originally from Ukraine,  that discovered this community via the podcast, joined up because I enjoyed the approach advocated.

Investors who got spooked by the recession and stopped buying regretted their short-sighted decision and them giving in to fear.