From Newsday:
As the slide in housing from boom to bust continues, congressional attention is focusing on the skyrocketing numbers of home foreclosures caused by the collapse of the “subprime,” or high-credit risk, mortgage market. It’s not a moment too soon. Legislation for regulatory oversight of often sleazy subprime lending practices is overdue.
In the heady years of the housing boom, tens of millions of Americans who could not qualify for traditional mortgages were duped into borrowing far more than they could afford. They succumbed to super-low “teaser” rates dangled by predatory brokers, rates that eventually would climb beyond the ability of many to pay.
Now such practices have turned into a disaster for brokers and homeowners alike. More than a dozen subprime lenders have gone bankrupt in the past year and more than a million homeowners across the nation are facing foreclosure.
Long Island, along with other areas of New York State, is bearing the brunt disproportionately. A study released by the office of Sen. Charles Schumer (D-N.Y.), who heads the Senate banking subcommittee, shows that by the end of 2008, as many as 8,378 families in Nassau and 10,476 in Suffolk could be at risk of losing homes obtained with subprime mortgages. In the state, nearly 100,000 homeowners face possible foreclosure.
“In the heady years of the housing boom, tens of millions of Americans who could not qualify for traditional mortgages were duped into borrowing far more than they could afford.”
These people were NOT duped… they were greedy… also… as i said in another thread, most of the subprimers were NOT first-time homebuyers… according to the MBA, 9% of the subprimers were first-time homebuyers… and according to the center for responsible lenders, this # was 11%… so… again… these people were already homeowners… they had a different mortgage and chose to do a Refi… and take a massive amount of CASH-OUT… and the only product that they could do that with was with a subprime… So, again… these people were NOT duped… they were greedy… they were just trying to keep with Mr. & Mrs. Jones and they lost!