Newly Refinanced Mortgages Go Bust


	Newly Refinanced Mortgages Go Bust

Victoria Barret

12-8-2008 1:18 PM

656 views

tags:

mortgages, default, refinance

Victoria Barret says:

Home loans modified earlier this year are showing a 58% default rate six months after the refinance. This shows something is going terribly wrong in our efforts to keep homeowners in their homes.

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<div style="margin: 12px 0px; font-family: arial; color: #333333; background: #ffffff; border: solid 4px #e5e5e5; width: 100%; clear: left;"><div class="CM_CTB_Content_Wrap" style="margin: 0px; padding: 0px;background-color: #ffffff;"><div style="border-bottom: solid 1px #dcdcdc; white-space: nowrap; margin-bottom: 8px; background-color: #eeeeee ;background-image: url(http://clipmarks.com/images/source-bg.gif); background-repeat: repeat-x; height: 24px; line-height: 24px; vertical-align: middle; padding-bottom: 4px; color: #666666; font-size: 10px;" ><a href="http://clipmarks.com/clip-to-blog/" title="see clips that are hot right now"><img src="http://content.clipmarks.com/blog_embed/b522c6ae-d29d-4306-a366-9b84bbd27139/13D7EB88-48E5-4832-8AD3-17BECB99DEB6/" alt="" width="19" height="19" border="0" style="vertical-align: middle; margin: 0px 4px; display: inline; border: none; float:none;" /></a>clipped from <a title="http://www.occ.gov/ftp/release/2008-142.htm" href="http://www.occ.gov/ftp/release/2008-142.htm" style="font-size: 11px;">www.occ.gov</a></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.occ.gov/ftp/release/2008-142.htm"><P>WASHINGTON — Comptroller of the Currency John C. Dugan said today that new data shows that more than half of loans modified in the first quarter of 2008 fell delinquent within six months.
</P></blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.occ.gov/ftp/release/2008-142.htm">“After three months, nearly 36 percent of the borrowers had re-defaulted by being more than 30 days past due.  After six months, the rate was nearly 53 percent, and after eight months, 58 percent,”</blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.occ.gov/ftp/release/2008-142.htm">The mortgage metrics report covers nearly 35 million loans worth more than $6.1 trillion, or about 60 percent of all first-lien mortgages in the United States. </blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.occ.gov/ftp/release/2008-142.htm">Is it because the modifications did not reduce monthly payments enough to be truly affordable to the borrowers?  Is it because consumers replaced lower mortgage payments with increased credit card debt?  Is it because the mortgages were so badly underwritten that the borrowers simply could not afford them, even with reduced monthly payments?  Or is it a combination of these and other factors?</blockquote></div><div style="margin: 0px 6px 6px 4px;"><table style="font-size: 11px;border-spacing: 0px;padding: 0px;" cellpadding="0" cellspacing="0" width="100%"><tr><td style="background:transparent;border-width:0px;padding:0px;">&nbsp;</td><td align="right" style="background:transparent;border-width:0px;padding:0px;width:107px" width="107"><a href="http://clipmarks.com/share/13D7EB88-48E5-4832-8AD3-17BECB99DEB6/blog/" title="blog or email this clip"><img src="http://content9.clipmarks.com/images/c2b-foot.png" border="0" alt="blog it" width="107" height="17" style="border-width:0px;padding:0px;margin:0px;" /></a></td></tr></table></div></div>

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