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When Will the Tsunami of Foreclosures Hit?
MSN.com Real Estate ^
| 9/5/2006
| Charles DuBow
Posted on 09/05/2006 2:01:48 PM PDT by ex-Texan
With millions of adjustable-rate mortgages about to reset this fall, experts expect a wave of foreclosures by Americans in every income bracket. Here's why they could soar in late 2006 and beyond:
Those easy-mortgage chickens are coming home to roost.
This fall the adjustable-rate mortgages (ARMs) that millions of Americans took out during the recent housing boom will be reset, and many homeowners will see their monthly mortgage payments shoot up by as much as 20%. According to the Mortgage Bankers Association, of all mortgages financed in 2005, 36% were ARMs -- the highest ever.
This is a matter of concern because ARMs are typically initially made at a lower rate and then increase after a fixed period of time, usually one, three, five, seven or 10 years, after which the rate will more closely reflect current rates. As interest rates increase, mortgage payments increase. Between $400 billion and $500 billion in ARMs are due to be reset by the end of 2006. The following year will be even more dramatic, when more than $1.5 trillion will be reset.
For many Americans, this is scary news, if hardly unexpected. * * * [M]any of them are finding themselves stuck in a house they may soon no longer be able to afford, and, as the real estate market peters out, there's little they can do about it. * * *
Unprecedented situation:
* * * A major concern is that the number of ARMs issued at subprime rates to borrowers with lower credit ratings is not known. "We know that ARMs default at a higher rate than fixed, and subprimes default at higher rates than primes," says Sharga. "Never have so many ARMs reset at the same time. There is no precedent for it."
(Excerpt) Read more at realestate.msn.com ...
TOPICS: Business/Economy; Culture/Society; Editorial; Government
KEYWORDS: alasandalack; andagonyonme; anguish; armlessanddoomed; attentionwhore; bubbles; depression; despair; despondent; doom; doomgloomer; dustbowl; eeyore; gloom; grapesofwrath; helpme; housing; hyperhysterics; iluvwilliegreen; imtomjoad; joebtfsplk; misery; mortgages; pimpmywebsite; realestate; runawayrunaway; sackclothandashes; skyisfalling; slitmywrist; weneedmisery; williegreenismyhero; woeisme
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There it is people. Please do not blame me. I am only the messenger. Take a peek at this map and hit the link. It details the initial regions of the U.S. most likely to suffer in the coming tsunami of forecloures:
Want to learn a little bit more? Just hit my FR page. Want to study the the big picture in detail? For all the naysayers out there: "Nothing to see here. Lock your doors and windows. Time to move on."
1
posted on
09/05/2006 2:01:48 PM PDT
by
ex-Texan
To: ex-Texan
It looks like California might just be a good hunting grounds for sweet real estate deals in the near future.
2
posted on
09/05/2006 2:03:33 PM PDT
by
TChris
(Banning DDT wasn't about birds. It was about power.)
To: ex-Texan
Please do not blame me. I am only the messenger. I do blame you, this is 100% your fault.
3
posted on
09/05/2006 2:05:03 PM PDT
by
Graybeard58
(Remember and pray for SSgt. Matt Maupin - MIA/POW- Iraq since 04/09/04)
To: ex-Texan
Cool. I've always wanted a place in Long Beach.
4
posted on
09/05/2006 2:05:22 PM PDT
by
1rudeboy
To: ex-Texan
That Business Week article is a total hatchet job and fear-mongering piece designed to sell magazines.
5
posted on
09/05/2006 2:05:24 PM PDT
by
Dems_R_Losers
(Meet the new dictators of America.....Bill Keller, James Risen, Eric Lichtblau, and Dana Priest)
To: Hydroshock; GodGunsGuts; M. Espinola; durasell; Mini-14; Calpernia
6
posted on
09/05/2006 2:05:44 PM PDT
by
ex-Texan
(Matthew 7: 1 - 6)
To: TChris
Not if the FHA starts offering 1%APR/no-down mortgages to illegals.
7
posted on
09/05/2006 2:05:54 PM PDT
by
txhurl
To: ex-Texan
I never could understand the attraction of ARM's. When we refinanced to a lower rate, we went for a 15 year fixed.
8
posted on
09/05/2006 2:06:01 PM PDT
by
Clintons Are White Trash
(Lynn Stewart, Helen Thomas , Molly Ivins, Maureen Dowd - The Axis of Ugly)
To: TChris
Cry "Recession!" and let slip the vultures of opportunity.
9
posted on
09/05/2006 2:06:19 PM PDT
by
1rudeboy
To: ex-Texan
There it is people. Please do not blame me. I am only the messenger. Why not blame you? You've repeated the same thing for many months.
10
posted on
09/05/2006 2:06:27 PM PDT
by
Moonman62
(The issue of whether cheap labor makes America great should have been settled by the Civil War.)
To: ex-Texan
No sources listed for the map...
11
posted on
09/05/2006 2:06:32 PM PDT
by
durasell
(!)
To: Graybeard58
I do blame you, this is 100% your fault.Wait! I thought it was Bush's fault.
12
posted on
09/05/2006 2:07:11 PM PDT
by
AngryJawa
({NRA}{IDPA})
To: ex-Texan; Mase; nopardons; Toddsterpatriot; jennyjenny; Fan of Fiat; expat_panama
13
posted on
09/05/2006 2:07:49 PM PDT
by
Petronski
(Living His life abundantly.)
To: ex-Texan
Doesn't this just prove that California is the home of millions of people who don't have any common sense when it comes to handling money?
To: ex-Texan
My house is paid off so all I owe are taxes.
15
posted on
09/05/2006 2:09:53 PM PDT
by
cripplecreek
(If stupidity got us into this mess, then why can't it get us out?)
To: ex-Texan
So, 40% of 11% of the US population has unattractively refinanced mortgages?
So, in the worst-case scenario we are looking at a 4% default rate.
My, my, how frightening.
16
posted on
09/05/2006 2:10:42 PM PDT
by
wideawake
("The nation which forgets its defenders will itself be forgotten." - Calvin Coolidge)
To: ex-Texan; Admin Moderator
Do not spam us with links to your own site. No one likes spam. Is spamming with links to his site okay? Or should he give us all a break?
17
posted on
09/05/2006 2:11:03 PM PDT
by
Toddsterpatriot
(Why are protectionists so bad at math and reading?)
To: Brilliant
"When Will the Tsunami of Foreclosures Hit?"
My bet is the day the RATS take over congress.
The first thing they are going to do is close the deficit by retracting all the tax breaks. Then they will put us all back in the red by giving all that revenue to Blue state failed programs.
When the interest rates hit 21%, the RATS will blame Bush and the Republicans for it.
18
posted on
09/05/2006 2:11:09 PM PDT
by
EQAndyBuzz
(Mediacrat - A leftwing editorialist who pretends to be an objective journalist.)
To: ex-Texan
I blame you because:
A) You wrote up the concept of wacky mortgages and faxed them to bankers across the country in the middle of the night.
B) You travel the country, like Santa, dropping enticing flyers into folks' mailboxes tauting wacky mortgages.
C)Your fleet of asynchronous satellites broadcast subliminal messages into regular television programs during prime time and the Superbowl.
D)You perform black magic ceremonies naked in your basement with live armadillos and naked loose-limbed dancing every full moon.
19
posted on
09/05/2006 2:11:25 PM PDT
by
durasell
(!)
To: Graybeard58
I do blame you, this is 100% your fault.LOL!
20
posted on
09/05/2006 2:11:49 PM PDT
by
American Quilter
(You can't negotiate with people who are dedicated to your destruction.)
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