Monday, October 27, 2008

Lest we forget...

Lest we forget, the current crisis was started by the bursting of the housing bubble... In all the hubbub re TARP; assisting the banks, bank holding companies, and the insurance companies, etc. it is easy to forget that housing prices are still going south in many parts of the country. And the subprime mess is not over!

An estimated "... half a million mortgages, worth about $110 billion, will have their intro "teaser" interest rates reset over the next six months, according the latest available data from First American CoreLogic, a mortgage industry research group..." (see 'The next wave of foreclosures'). And "... a large number of borrowers still on the low "teaser" rates are already falling behind on payments -- one in seven is between 30 and 90 days late, according to HUD. The figures are worse for mortgages whose rates have already changed -- more than a fifth of those are behind. These borrowers have not yet gone into foreclosure, but if they do not start to make repayments, they might ..."