Dr. Housing Bubble Blog has an interesting anecdotal story about the whole foreclosure process about a couple in California that recently had their home seized. It sounds like a story of a family that lived the high life (they had $25k in credit card debt and two car loans for two new luxury cars) and it came to a crashing halt when one of them lost their job.
The real story is the fact that they were over-extended, caught up in enjoying life, and didn’t have a backup plan when their rate reset and the husband lost his job. Could they have sustained their lifestyle without the hike? Probably not.
Anyway, it’s an interesting read and a bit of an eye-opener.