More than a fifth of subprime homeowners in the UK have fallen behind with their mortgage repayments. In the United States we have another looming problem as gasoline continues to cost more. Subprime borrowers in the US are falling behind. Costs are escalating. In the past few days HSBC and UBS came forward with forecasts of more subprime problems ahead. Let’s take a look at subprime and Alt-A in total. A report on Housing Wire says “The number of troubled Alt-A borrowers in the 2007 vintage rose an eye-popping 26.5 percent from March to April alone, nearly reaching 17 percent of loan volume.”
Archive for » May, 2008 «
Irony strikes again as opportunists are taking advantage of other opportunists. Squatters are taking possession of foreclosed homes. Invoking their rights as ‘tenants’ nobody is willing to come forth to dispute the fact, and banks (the other opportunists) as actually paying squatters to leave. The situation seems ironic to me. California has seen the problem more than other states, although Ohio sent some reports. Banks did not pay the original owners to leave. In fact, after some banks like Countrywide and HSBC added additional charges during bankruptcy they compounded the problem for homeowners. Of course many owners just gave up, without bankruptcy. I can imagine the response if the bank asked the former owner to verify that the current squatter is not a tenant.
Category: Analysis
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U.S. foreclosure filings climbed 65 percent and bank seizures more than doubled in April from a year earlier as rates on adjustable mortgages increased and vacated homes added to a glut of unsold homes. Amid the mess mortgage lenders are telling us how many borrowers were helped by their loving, consumer oriented customer care staff. It sounds like banks could not help enough of their borrowers.
What guidelines did banks use to help the few?
Category: Economic Impact
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Just when we thought subprime could not get uglier, one of the world’s largest banks has found a way to usurp U.S. government regulations. High-Rate, High-Fee Loans HOEPA/Section 32 Mortgages and how to get around the regulation seems to be the newest and latest marketing ploy.
Category: Root Causes
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Government sometimes works quickly to create laws or legislation that sometimesw results in overkill. Lack of forward-looking thinking should include an analysis of how scam artists will beat the system. Apply that logic to our new proposed anti-foreclosure bill. The newest and latest argument is over $15 billion in grants and loans to buy and refurbish abandoned homes. Should the federal government give this money to the states?
Category: Government Positions
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