That's according to Forbes magazine, which sees us bouncing back big.
Cut and paste link below to view article:
http://www.sptimes.com/2007/07/25/news_pf/Business/No_1_spot_to_buy_a_ho.shtml
Tuesday, February 5, 2008
Friday, January 4, 2008
SUBPRIME ARM LOAN RATES
SUBPRIME ARM LOAN RATES
Almost half of subprime ARM loans are concentrated in a handful of states, which are expected to suffer increasing foreclosures as the loans reset to higher rates.
For the full story, visit http://www.usatoday.com/money/economy/housing/2008-01-03-real-estate-2008_N.htm
The following is a list of states with the highest percentage of the nation's subprime ARMs:
California 17.3%
Florida 12.3%
Texas 5.7%
Illinois 4.9%
Michigan 3.6%
New York 3.5%
Georgia 3.3%
Maryland 2.9%
New Jersey 2.7%
Pennsylvania 2.7%
Washington 2.6%
Virginia 2.4%
Almost half of subprime ARM loans are concentrated in a handful of states, which are expected to suffer increasing foreclosures as the loans reset to higher rates.
For the full story, visit http://www.usatoday.com/money/economy/housing/2008-01-03-real-estate-2008_N.htm
The following is a list of states with the highest percentage of the nation's subprime ARMs:
California 17.3%
Florida 12.3%
Texas 5.7%
Illinois 4.9%
Michigan 3.6%
New York 3.5%
Georgia 3.3%
Maryland 2.9%
New Jersey 2.7%
Pennsylvania 2.7%
Washington 2.6%
Virginia 2.4%
Homeowners Be Prepared & Know Your Options!
Make Sure You Check Your Documents
Nearly 2 million homeowners have subprime, adjustable-rate mortgages (ARMs) that will reset before July 2010.
But there are many exclusions to the program. In addition, millions of borrowers with prime ARMs aren't eligible. Neither are most of those with exotic adjustable-rate loans that let them pay only the interest portion or even less each month.
Dan Przewlocki is one of them. He refinanced his home outside Detroit in 2004, so he doesn't qualify for the rescue plan. Przewlocki, 52, got what's called an option-ARM. It lets him choose among payment options each month. The less he pays, the more the principal balance grows.
He's been paying the highest option and hasn't missed one payment. Yet his rate has been rising nearly every month, catapulting Przewlocki's monthly payment to $2,700 from $1,200 initially.
Washington Mutual, his lender, won't refinance the $310,000 loan because the home's value has sunk below the value of the loan, to $250,000, Przewlocki said.
He works in an auto maintenance plant and looks for handyman jobs and temporary work at Kelly Services. But his house payments eat up nearly 70% of his gross income. And Przewlocki, a tech sergeant in the Air Force reserves, knows he'll fall behind on his payments once he's deployed to the Middle East this year.
"If the mortgage company wants to take the house," he says, "the keys are going to be on the kitchen table."
Sara Gaugl, a spokeswoman for Washington Mutual, says the amount of Przewlocki's loan and the current value of his house "put him out of scope for a refinance under WaMu's credit guidelines. However, we will continue to work with Mr. Przewlocki to determine if there are other options available to him."
If you're in a similar situation, or think you might be soon:
•Contact your lender as soon as you know your payment will be late. If you want free credit counseling, you can also call the
Homeownership Preservation Foundation at 888-995-HOPE (888-995-4673).
If you can't renegotiate the terms of your loan, and your home is worth less than you owe, consider a "short sale": If your lender approves, you can sell your property at an agreed upon price, and your lender will forgive the remaining balance on your mortgage.
That's much better than wrecking your credit with a foreclosure. And under a law signed by President Bush last month, sellers no longer have to pay taxes on the amount of the forgiven debt. The law is retroactive to Jan. 1, 2007, and is scheduled to expire at the end of 2009.
- Dig out your mortgage documents and triple-check what kind of loan you have. Specifically, you want to know whether it has an adjustable interest rate, how often the rate can rise and the maximum it can rise to. Is there a penalty for paying off the loan early? If so, when does the penalty expire?
Nearly 2 million homeowners have subprime, adjustable-rate mortgages (ARMs) that will reset before July 2010.
- The average borrower will see monthly payments jump by about $350, to $1,550. Already, one in five homeowners with a subprime ARM was behind at least one payment at the end of the third quarter, according to the Mortgage Bankers Association.
- Last month, Treasury Secretary Henry Paulson announced a deal with lenders that would help thousands of homeowners with subprime ARMs. Under the plan, homeowners who got their loans between Jan. 1, 2005, and July 31, 2007, would either be put on a fast-track program to refinance their loan to a fixed-rate mortgage at a lower rate, or have their rate frozen for five years.
But there are many exclusions to the program. In addition, millions of borrowers with prime ARMs aren't eligible. Neither are most of those with exotic adjustable-rate loans that let them pay only the interest portion or even less each month.
Dan Przewlocki is one of them. He refinanced his home outside Detroit in 2004, so he doesn't qualify for the rescue plan. Przewlocki, 52, got what's called an option-ARM. It lets him choose among payment options each month. The less he pays, the more the principal balance grows.
He's been paying the highest option and hasn't missed one payment. Yet his rate has been rising nearly every month, catapulting Przewlocki's monthly payment to $2,700 from $1,200 initially.
Washington Mutual, his lender, won't refinance the $310,000 loan because the home's value has sunk below the value of the loan, to $250,000, Przewlocki said.
He works in an auto maintenance plant and looks for handyman jobs and temporary work at Kelly Services. But his house payments eat up nearly 70% of his gross income. And Przewlocki, a tech sergeant in the Air Force reserves, knows he'll fall behind on his payments once he's deployed to the Middle East this year.
"If the mortgage company wants to take the house," he says, "the keys are going to be on the kitchen table."
Sara Gaugl, a spokeswoman for Washington Mutual, says the amount of Przewlocki's loan and the current value of his house "put him out of scope for a refinance under WaMu's credit guidelines. However, we will continue to work with Mr. Przewlocki to determine if there are other options available to him."
If you're in a similar situation, or think you might be soon:
•Contact your lender as soon as you know your payment will be late. If you want free credit counseling, you can also call the
Homeownership Preservation Foundation at 888-995-HOPE (888-995-4673).
If you can't renegotiate the terms of your loan, and your home is worth less than you owe, consider a "short sale": If your lender approves, you can sell your property at an agreed upon price, and your lender will forgive the remaining balance on your mortgage.
That's much better than wrecking your credit with a foreclosure. And under a law signed by President Bush last month, sellers no longer have to pay taxes on the amount of the forgiven debt. The law is retroactive to Jan. 1, 2007, and is scheduled to expire at the end of 2009.
Fed Auctions
The Federal Reserve announced today that it is increasing the amount of money available to banks through the new auction process it created to ease the nation's severe credit squeeze. The Fed again pledged to continue the auctions "for as long as necessary."
This announcement from the Fed came after today’s release of a government report showing that the jobless rate shot to a two-year high of 5% in December, raising concerns about a possible recession. The worry is that a severe slump in housing, soaring energy prices and the credit crisis that hit in August will combine to push the country into a full-blown downturn.
The Fed’s auction announcement indicates to analysts that the process it began in December (after efforts to inject funds into the banking system through direct loans to banks had not been as successful as hoped) has been successful in providing a source of loans for cash-strapped banks.
The amount offered at each of the next two auctions will be increased from $20 billion to $30 billion. Those two auctions will be Jan. 14 and Jan. 28. In a brief statement, the Fed said that it planned to continue to conduct the auctions every two weeks "for as long as necessary to address elevated pressures in short-term funding markets."
Amidst the negative speculations that the US economy is heading straight for a recession, the Fed continues to take slow steps. Despite the three less-than-exciting key rate cuts since September, analysts predict that the December jobless report increased the likelihood that the Fed will CONTINUE cutting interest rates as a way of boosting economic growth.
Stephanie Stanina
This announcement from the Fed came after today’s release of a government report showing that the jobless rate shot to a two-year high of 5% in December, raising concerns about a possible recession. The worry is that a severe slump in housing, soaring energy prices and the credit crisis that hit in August will combine to push the country into a full-blown downturn.
The Fed’s auction announcement indicates to analysts that the process it began in December (after efforts to inject funds into the banking system through direct loans to banks had not been as successful as hoped) has been successful in providing a source of loans for cash-strapped banks.
The amount offered at each of the next two auctions will be increased from $20 billion to $30 billion. Those two auctions will be Jan. 14 and Jan. 28. In a brief statement, the Fed said that it planned to continue to conduct the auctions every two weeks "for as long as necessary to address elevated pressures in short-term funding markets."
Amidst the negative speculations that the US economy is heading straight for a recession, the Fed continues to take slow steps. Despite the three less-than-exciting key rate cuts since September, analysts predict that the December jobless report increased the likelihood that the Fed will CONTINUE cutting interest rates as a way of boosting economic growth.
Stephanie Stanina
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