Printer-Friendly
Email this Story
Post a Comment (0)
Re-setting Mortgages: $130 Billion Of Loan Adjustments Will Increase Short Sales And Foreclosures
Nationally, over the next two years, according to published data a total of $130 billion of Prime, Alt-A, and Subprime loans are due to “recast” (change interest rate and terms). Interest only payment loans by the thousands will change their “monthly required expenditures” and assault homeowners with increases of up to 15% in monthly payments (principal and interest). Many households will be forced to make decisions to tighten their belts or suffer default and/or foreclosure.
Recent data gathered, mostly from 2006 – 2008, show that after “re-setting,” prime loans, those given to buyers that qualified fully, become “60 day delinquent” at a 6% higher rate while Alt-A-loans and subprime loans become “delinquent” at an increased rates of 17% and 28% respectfully.
Home sales skyrocketed in Fauquier, Culpeper, and Rappahannock counties in 2004 – 2006 and with those sales an increased usage of Alt-A and Sub-prime loans. One may suggest that although somewhat “isolated” from recessionary trends with our proximity to Washington, D.C., we have not, nor will not be unaffected; delayed or slowed recovery in the local housing market is unavoidable. Does anyone hear a second “thud?”
Thoughts or comments, please contact Don Khoury, info@realestatephd.com or 540-341-8926.
You must be logged in to post a comment.