From the NY Daily News:
The number of city foreclosures jumped 18% in the last half of 2006 – with as many as 100 homes going on the block each week in both Brooklyn and Queens, according to Crain’s New York Business.
“The last time I saw it this bad was in the early 1990s,” Jessica David, president of Profiles Publications, which tracks foreclosure figures, told Crain’s for today’s edition.
New York City numbers pale in comparison with the nationwide surge in foreclosures, which are up 45% from the corresponding period of 2005. But the filings here are accelerating and show New York may be catching up with the rest of the country, the report found.
Experts charge lenders lure naive borrowers into taking on unmanageable debt by extending loans with rates that start out low but quickly rise.
“The [lending] industry is exploiting customers’ ignorance and seizing the opportunities offered by the skyrocketing real estate market,” said Sarah Gerecke, chief executive of Neighborhood Housing Services of New York City.
Interest-only loans and piggyback loans that let people borrow with no money down also help coax wanna-be homeowners to go out on a financial limb.
Staten Island homeowner Leone John said she worried that the $280,000 home she bought in 2004 was more than she could manage. But a two-year freeze on the interest persuaded her to take the plunge.
Now her payments have jumped 30%. That hike, along with other unanticipated expenses, has put her behind in her payments – and has her fearing the worst.
Any mortgage brokers out there???
Just curious, does anybody know what the current, ballpark quotes[teaser rates] are for I/O loans??? Have the lending institutions varied the adjustment time frame, to alleviate the consequences of these all coming due at the same time???
“Unanticipated expenses”. That is another thing, people stretched to the very limit without having any cushion whatsoever. The combination, with a killer loan, is toxic, the US suffers from over confidence.