Housing Sector May Be Hit By “100%” Loans
Posted by mortgageforensics on March 3, 2007
WASHINGTON (Reuters) – U.S. homeowners who bought using 100 percent financing, and those who took out “home equity” loans against the value of their properties, even though they have good credit ratings, could be the next to cause problems in the U.S. housing market.
In recent months, borrowers with poor credit histories have resulted in about 20 lenders and mortgage brokers going out of business as defaults have risen in the so-called “subprime” sector of the home loan markets.
But as U.S. house prices continue to fall, following the boom in property prices which ended in 2005, even borrowers with good credit records may have problems as the value of their homes may now be less than the debt they owe. For the full article:
