Free Republic

The subprime mortgage crisis is spreading to a somewhat unexpected place: homes costing more than $500,000. As lending has rapidly gotten more restrictive for borrowers taking out large loans, sales of expensive homes have fallen sharply around the country during what should be one of the busiest seasons for buyers and sellers, mortgage bankers and real estate agents say. To some degree the change is due to difficulty getting financing, as borrowers are finding fewer lenders willing or able to fund "jumbo" mortgages, loans for amounts greater than $417,000. Such loans are too big to be guaranteed by government-sponsored housing...

Sheriff Leo McGuire presides over foreclosure auctions in Bergen County, New Jersey, where the bidding for a home reached $1.2 million last June — a record for one of the wealthiest counties in the nation. Homes sold on the auction block for as much as $852,000 this month — more than quadruple the median home price in the United States. County officials believe they are close to setting another record soon. In Troy, Michigan, Dorothy Guzek, a credit counselor since 1988, has also seen the changing face of foreclosure. Her clients, while predominantly poor and minorities, increasingly are neither. Nowadays,...