I've been saying this for a long time

This is going to make our next home buying experience much less costly. Banks don't like owning houses.

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Keep Eyes Fixed on Your Variable-Rate Mortgage

By DAMON DARLIN
Published: July 15, 2006
The raising of interest rates on millions of adjustable rate mortgages over the next several years has all the makings of a classic horror story.
As home prices appreciated from ridiculously high to unbelievably higher, more Americans began using mortgages that allowed them to buy more house for less of a monthly payment. Next year, a large portion of those rates move up and homeowners who opted for the exotic mortgages could find their payments doubled. Talk about bloody. They need to find a way to minimize the pain.
Many will refinance their loans. But for others, whose mortgages now exceed the value of their homes or whose debt payments exceed 40 percent of their incomes, there may be no other solution than to get out of their houses. With the housing market cooling, selling it may not be easy. Some may default on their loans.

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The article notes that 40% of mortgages in the Washington area in 2005 were interest only.

Note that the only people who aren't worried are mortgage brokers.