Easier Terms For Subprime Borrowers

During the second half of last year, over 370,000 homeowners with sub-prime mortgage loans managed to negotiate easier terms with their lender.

It’s unknown how many of those are in the Boulder real estate market but I know that while Boulder county has its fair share of homeowners in trouble, counties like Adams, Weld and Larimer are really hit hard in this period of adjustment.

One of the typical elements of the new terms were rate freezes on soon-to-increase ARM’s. Many also included new payment plans. In the third quarter of 2007 alone approximately 250,000 borrowers renegotiated with their lenders for new terms that would enable them to keep paying their loans and avoid foreclosure.

Since the mortgage industry said last month that it would expedite refinancing or five-year rate freezes for as many as 1.2 million troubled sub-prime borrowers, the numbers are expected to skyrocket even further.

A group named Hope Now Alliande is releasing data on these changes and coordinating the mortgage industry response to the national mortgage crisis.

With the house passing higher loan limits and the senate set to vote in a few days on the issue, we may see another impact on the housing marketplace both in the national scene and locally.

Comments

Got something to say?