Our settlement department was busy a few years ago closing what are now called sub-prime mortgage loans. They varied from "interest only" loans to those featuring locked-low payments with interested adjusting to LIBOR ever few months and the possibility of negative amortization up to 125% of the original principal balance of the loan. If you have a problem understanding that sentence, join the borrowers who lined up to cash in on the their so-called equity. These folks were in over their head the moment they walked away with the leftover cash from their refinance.
Now comes the FDIC with a plan "to prevent an estimated 1.5 million foreclosures by the end of 2009. She plans to accomplish this feat by modifying more than two million loans at what she estimates would be a taxpayer cost of $24 billion. This may be wonderful politics, but the real-world evidence suggests it will be far more difficult and expensive."
For more details on the plan and its likelihood of success read the Wall Street Journal article Sheila Blair's Mortgage Miracle
Stephen M. Flatow
Vested Title Inc., 648 Newark Avenue, P.O. Box 6453, Jersey City, NJ 07306. Tel 201-656-9220. Fax 201-656-4506. E-mail vti@vested.com
Sphere: Related Content
Wednesday, December 3, 2008
Subscribe to:
Post Comments (Atom)
Posts
No comments:
Post a Comment