Comparing the foreclosure rates of the year 2008 with the year 2009, there is a lot that the US stock is not able to bear with, due to the too much upheaval caused by the Inflation.
According to the economists the housing market is not going to improve so soon and in fact there is going to be more filings of foreclosure comparatively and the rates are also going to fall more and more.
As of now there is a total collapse of the Subprime Mortgage Markets and the next one to drop down is the Adjustable Rate Mortgages (ARM) which has begun in the April of 2009.
These loans actually encouraged many owners to mortgage property and get more loans for less interest rate and due to which many are now suffering and losing their property as foreclosure.
Earlier people with a little more income than the normal were allowed loans on mortgage on ARM and with a little less income were allowed loans on subprime.
People who borrowed loans on subprime have already lost their property on foreclosure and now people who borrowed under ARM are sufferers.
Those who were earlier considered for ARM are now not even eligible for Subprime.
People who have borrowed loans based on ARMs were allowed to make payment only on the interest part which has now totally resulted on negative pay back.
Even though the people who have lent are paying back their payment they are able to pay back only the interest as per the scheme and are now at a higher risk of losing their property on foreclosure.
They are now not able to sell their property also as there is a fall in the value of the property and are worried about the disappearing equity also.
But many feel happy paying more payment each month for the mortgage value and are happy that their equity has got eliminated totally on the loan.
Many people fall into trouble as they don't completely understand that they have to start paying their principal on debt amount as well as the interest when the interest rates reduce time and again.
And they also lose the option of selling their properties when there is such slowdown on the economy.
Now we can clearly understand how the economy has affected the housing industry and how it has forced many to file for foreclosure and thus resulting in increased foreclosure rates.
So it is hike time for house owners to take decision on trying new options such as re-financing or selling the property for a better price rather than allowing the banks to take it over as a foreclosure.
According to the economists the housing market is not going to improve so soon and in fact there is going to be more filings of foreclosure comparatively and the rates are also going to fall more and more.
As of now there is a total collapse of the Subprime Mortgage Markets and the next one to drop down is the Adjustable Rate Mortgages (ARM) which has begun in the April of 2009.
These loans actually encouraged many owners to mortgage property and get more loans for less interest rate and due to which many are now suffering and losing their property as foreclosure.
Earlier people with a little more income than the normal were allowed loans on mortgage on ARM and with a little less income were allowed loans on subprime.
People who borrowed loans on subprime have already lost their property on foreclosure and now people who borrowed under ARM are sufferers.
Those who were earlier considered for ARM are now not even eligible for Subprime.
People who have borrowed loans based on ARMs were allowed to make payment only on the interest part which has now totally resulted on negative pay back.
Even though the people who have lent are paying back their payment they are able to pay back only the interest as per the scheme and are now at a higher risk of losing their property on foreclosure.
They are now not able to sell their property also as there is a fall in the value of the property and are worried about the disappearing equity also.
But many feel happy paying more payment each month for the mortgage value and are happy that their equity has got eliminated totally on the loan.
Many people fall into trouble as they don't completely understand that they have to start paying their principal on debt amount as well as the interest when the interest rates reduce time and again.
And they also lose the option of selling their properties when there is such slowdown on the economy.
Now we can clearly understand how the economy has affected the housing industry and how it has forced many to file for foreclosure and thus resulting in increased foreclosure rates.
So it is hike time for house owners to take decision on trying new options such as re-financing or selling the property for a better price rather than allowing the banks to take it over as a foreclosure.