The Las Vegas News press has the latest on that housing bubble. "As the foreclosure rate creeps up in the Las Vegas Valley, the options for homeowners in financial trouble may be dwindling. A rise in interest-only and adjustable-rate mortgages have left even the distressed-property buyers saying 'no thanks' to many homes a few steps away from auction."

"Despite a recent increase in signs around town promising such things as 'CASH FOR YOUR HOUSE in 48 HOURS,' the market for mortgage defaults isn't that good right now, lamented some in the foreclosure-buying industry."

"'We get a lot of phone calls, but only so many of those phone calls are good phone calls. Most have no equity or are upside-down,' said Doug Kupertman, who buys properties in danger of foreclosure. He has seen the number of inquiries from his Yellow Pages ad increase over the past six months, but few are qualified leads."

"Rising rates, interest-only loans and ARMs with balloon payments have now made a lot of deals simply unworkable, according to Kupertman. 'In that kind of business, there is no money in it for me,' he said. Investors often end up with unmanageable payments on non-amortizing mortgages. 'There are a bunch of people who don't have money but read a book about flipping houses. They find a house and want to turn it around for a profit.'"

"Non-amortizing mortgages are common deal-killers when homeowners seek fast-sell, fast-cash foreclosure buyers, according to one operator in the distressed-property buying business. 'The market is going down and you have people in a property that is worth less than they owe,' said the man, who asked not to be identified. 'We get five calls a day from people we can't help. They are stuck in their homes with no equity.'"

"Federal Deposit Insurance Corporation's most recent numbers show 61.3 percent of Nevada mortgage loans are interest-only and ARMs, making it second only to California."

"Affordable Housing Solutions owner Janis Rounds gets a lot of calls on buying homes with two-year, adjustable-rate loans that are about to reprice. Homeowners know they can't the pay the rate increases, but are often subject to early repayment penalties if they sell."

"'Very few of the people who call have any equity to be concerned about,' she said, recalling a California investor who offered to sell 26 Nevada homes to her. 'He was upside down in 19 of them.'"

"Suspect appraisals on the original loan often come into play in defaults. 'There's no way some of these properties could sell for what they were (appraised at being) worth,' Rounds contended. 'Without these people knowing it, they are getting a loan in excess of 100 percent of the value of their homes.'"

"Overinflated appraisals are a common problem in the home loan industry, agreed Bill Apgar, at Harvard University. 'Often, it was the mortgage broker that got them into a house that was overpriced,' he said, adding that this often leaves the troubled home owner angry at the wrong people. 'These guys are long gone now, and the person on the phone (with the home owner) is the one who purchased the contract.'"

"To make matters worse, potential homebuyers may be advised to borrow beyond their means, Debra March of UNLV surmised. 'What I had heard is that people were being encouraged to buy as much home as they could afford by the brokers.'"

"Apgar concurred that it can be a vicious cycle for homeowners trapped in bad loans, and he cautioned against selling for quick cash. 'People being foreclosed on are in a state of ether, then some quick-talking person comes along.' As a result, he added, the homeowner can often end up 'victimized twice,' first by the broker and then by the buyer."

"'Most people in foreclosure don't have a great sad story. Most people in foreclosure just bit off more than they could chew,' Rounds said. 'One woman refinanced her home and bought three motorcycles with cash and now can't pay her mortgage.'"