Posted on 03/14/2007 9:41:41 AM PDT by OnRightOnLeftCoast
WASHINGTON (AFP) - In the heady days of the US real estate boom, it seemed like a safe bet to use her house as collateral for a loan. Today, Sharon Edwardsen risks losing her Staten Island, New York home, trapped by spiraling payments.
Edwardsen, a 47-year-old assistant optician, was tempted to take out a special high-risk loan targeted at people with low credit ratings. Today her monthly repayments have soared to 2,800 dollars, yet she only takes home 1,600 dollars.
She is among 2.2 million people across the US who risk forfeiting their homes by the end of the year as they struggle to meet monthly repayments swollen by rising interest rates, and triggering fears that a financial crisis could sweep US lenders
(Excerpt) Read more at news.yahoo.com ...
check out this:
http://news.google.com/news?hl=en&ned=us&q=mortgage
And this:
http://news.google.com/news?hl=en&ned=us&ie=UTF-8&q=foreclosures
We are indeed living in interesting times,but not as interesting as the next year will be.
Al Gore will be pleased. Think of the reduction in carbon emissions!
She should've bought a smaller house.
A LOT of people should have bought a smaller house.
No, she should have moved to where her employment could afford a decent house. I imagine Staten Island has some fairly high priced real estate as opposed to say Shreveport Louisiana.
Each time she got into difficulties, her mortgage broker would offer a new deal. From an original loan of 103,000 dollars, she now owes the credit company some 285,000 dollars even though her monthly income has remained the same.
The article doesn't say why she needed $162,000 over 4 years.... that's $40K per year! What was she spending it on? How much is her house worth now if it was in the family forever? Can't she sell it? She hasn't had a pay raise in 4 years? Too much information left out....
I just heard a report that mortage applications are up because of the low 30 year fixed rate of about 6%.
Scratching head ...
Whoever becomes Pres in '09 will have quite a job to do. We better elect somebody avuncular like FDR although maybe not so much a Federalist.
Bulldukey. When you sign, you have to sign the Federal Truth in Lending Law, which means you are told what will happen to the rates according to your loan. Folks don't listen because they don't want to hear it - they don't count the costs and get caught. Bankruptcy due to these adjustable rates was a foregone conclusion and now that it is happening, do you think the industry will change itself? No Way, Dude...
The problem will have to get so bad that the states and or the Federal government will have to outlaw adjustable rates. This is because, behind each bankruptcy are citizen(s) and families in trouble.
Fools and the Fools that follow them: Obi Wan Kanobe
You got that one right. People don't realize it cost so much more money to heat and cool such a beast. That alone will cost you a small fortune.
Today her monthly repayments have soared to 2,800 dollars, yet she only takes home 1,600 dollars.
She should've bought a smaller house.
>>>
Seems to me she was never in a position to buy a house anyways. Of course you waste your money on rent, but a advisor should have told her to not even purchase a house on such low income and a non-fixed rate with questionable credit.
"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus
"She should've bought a smaller house."
She should not have mortgaged the family home and blown the money.
The Feds are between a rock and a hard place. On one hand, they could bail out the lenders at taxpayers expense OTOH, they could reduce rates to alleviate the mortgage crisis. However, that may allow inflation to get out of control.
What to do?
But, but, but....she was tempted. TEMPTED!!!! Have you no compassion???
"What to do?"
What they are supposed to do when people make stupid financial decisions. NOTHING.
"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus
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