Real Estate News Blog June Archive

Subprime lending: Abuse as usual

By Art C. Ryder at 06/28/07 01:31

It would appear that subprime lenders have yet to learn from their mistakes. According to a consumer advocate group, abuses persist industry wide, despite the recent subprime mortgage meltdown. Abuses such as unnervingly low tease introductory interest rates, punishing prepayment penalties, and the world famous “liar loans” are fueling the subprime market as lenders look for cash infusions. The recipe spells disaster as foreclosures are almost guaranteed. As noted before one in three (1/3) of these kinds of home mortgages lead to foreclosure.

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