Here There and Everywhere

Expat wanderer

Record foreclosures hit mortgage lenders

This story is from USA Today and is related to an earlier blog entry on spiraling mortgage foreclosures. The reason it caught my eye is that no-where in the article does it mention that the top two states where foreclosures occurred are Mississippi and Louisiana, the two states most recently hit – and hit hard – by hurricanes. And the reason people are failing to continue mortgage payments are that in some cases, the houses no longer exist and either they had no insurance, or the insurance company found a way NOT to pay up.

This is a big story – the record foreclosures – and evidence how in every society, when borrowing money becomes too easy, people get hurt.

It is an equally big story when the insurance companies don’t pay up. I have been told by the company insuring my Florida house that they will probably not continue insuring me. It is hard to find a company who will insure your house against hurricane damage in Florida.

By Noelle Knox, USA TODAY
The reason many mortgage lenders are in trouble became alarmingly clear Tuesday. The Mortgage Bankers Association said more than 2.1 million Americans with a home loan missed at least one payment at the end of last year — and the rate of new foreclosures hit a record.

The problem is most severe for borrowers with scuffed credit and adjustable-rate mortgages. More than 14% of them were behind on their payments. And the worst is yet to come, the MBA said. At least $300 billion in subprime ARMs will reset this year to higher interest rates. Those borrowers face higher payments and a harder time refinancing.

Blindsided by the number of loans that have already gone bad, more than two dozen lenders have gone out of business or been purchased. New Century Financial, the nation’s second-largest subprime lender, has quit making loans and is edging toward bankruptcy protection.

“There’s been a stunning erosion of mortgage quality,” said Mark Zandi, chief economist at Moody’s “It’s primarily in the subprime market, but the entire market is weakening … and that adds to problems in the housing market, and by extension the broader economy.” Retailers are already feeling the effect, he said, because homeowners tend to spend less when they fear their homes are worth less.

To stem their losses, lenders are ending 100% financing plans, requiring better credit scores and demanding more proof of a borrower’s income. The stricter rules are squeezing first-time buyers, as well as homeowners who want to refinance.

To read the rest of the story, and to see a state-by-state list of mortgage foreclosures, Click USA Today, here.

March 15, 2007 Posted by | Bureaucracy, Crime, Cross Cultural, Customer Service, ExPat Life, Family Issues, Financial Issues, Florida, Lies, Living Conditions, News, Political Issues, Social Issues, Uncategorized, Weather | 7 Comments

This Little Eggy

I was with my sweet friend and many of her 12 children, and I was goofing off with the younger ones, running, chasing. With tiny Abdulaziz, I started playing with his toes.

“This little . . . ” I started, and then caught myself in horror. The next word is “piggy” and my friends are devout Muslims.

She just laughed.

She said “Oh we do this too! We say ‘this little eggy went to market and this little eggy stayed home'”.

Oh! Thank goodness! Every child around the world loves that game; I’m so glad I can continue to play it here!

March 15, 2007 Posted by | Communication, Cross Cultural, ExPat Life, Family Issues, Friends & Friendship, Humor, Language, Middle East, Random Musings, Relationships, Words | 11 Comments