If the fed cuts rates this week, look for HELOC’s to adjust downward to follow the prime, which would most likely be 8%. All of those home-as-ATM folks will get a small bit of relief on those monthly payments.
In the real world, we are seeing numerous sales reps jumping ship from lender to lender, especially in the subprime market as companies continue to go under. Others are getting out of the wholesale market altogether and taking jobs in retail mortgages. The layoffs and closures have put many folks on the streets. A large number are changing industries altogether.
In addition, calls continue to come in from people worried that their ARMs are about to adjust (some for a 2nd or 3rd time). Unfortunately, not a lot can be done with some of these loans due to tightening standards, poor credit of the borrower, or high debt ratios. Some people are just plain stuck.
Last week in the Atlanta Journal, a family facing foreclosure was profiled and were SHOCKED when they arrived home from vacation to find a foreclosure notice and pending courthouse sale of their property in the mail. Now one wonders how someone could not know about something like this. They say they have been fighting with their loan servicer over charges and fees but you know what - you still have to make your payments. Oh yea, this family, fresh off a vacation, also stated that they had put in a pool and hot tub. The article did not say when they did it or how much they spent but when reading some of these articles on these folks who are in trouble, one just has to say ‘DOH’!
Leave a Reply