Sub-Prime Mortgages

The advent of "looser" credit standards during the past decade have created an overabundance of subprime mortgages. These loans were already 3 points higher than rates available to more creditworthy borrowers, and now they're being raised again! Mortgage companies make more profit on subprime loans than they do on conventional loans and now things are getting worse for those who can least afford it.

Approximately $1.2 billion in adjustable rate mortgages will reset to higher rates this year. Nearly half of that amount is in the form of sub-prime mortgages. Dallas, Texas is just one example of a market that has been flooded with subprime and adjustable rate mortgages. Dallas, which has the highest number of 30-day delinquent home mortgage loans of the 28 major real estate markets in the United States, recorded an astounding 4.05% of mortgage loans that were 30 days or more delinquent in the latest quarter.

When offered responsibility, subprime mortgages are certainly legal. However, more and more evidence is showing that certain lenders targeted specific individuals for subprime lending – even individuals whose credit was good enough to receive standard lending.

Subprime lenders are beginning to see legal action. For instance, it was discovered that the Home Mortgage Disclosure Act showed that black and Hispanic borrowers were more likely to get subprime loans from Countrywide Financial. Countrywide agreed, with lots of pressure from the New York attorney general, to adopt measures to prevent discriminatory pricing for minority borrowers. The settlement agreement suggests that Countrywide was steering minority borrowers into higher cost loans.

If you have a subprime mortgage and you feel you may have been inappropriately targeted or misled as to the conditions, please contact one of our attorneys by phone or email. To find out more about other cases we handle, select another case type on your left.

SUB-PRIME BLOG ARTICLES:
Blog articles are written by Angel Reyes To read other entries by Angel Reyes, visit his blog at AngelReyesBlog.com.
3/9/07 - Hedge Funds Bet Wrong on Subprime Markets
3/5/07 - Subprime Troubles - The Music Has Stopped
2/19/07 - Mortgage Derivatives Decline
2/16/07 - Net Losses Keep Piling Up For Subprime Lenders
2/15/07 - The Other Side of Sub-prime Mortgages
1/26/07 - Sub-prime Loans: Let the Buyer Beware!
1/8/07 - Sub-prime Loans... Blessing or Curse?

SUB-PRIME MORTGAGE NEWS ARTICLES:
4/25/07 - Law.com; Subprime Crash May Be a Boon to Attorneys
3/13/07 - CNNMoney; Scary math: More homes, fewer buyers
3/13/07 - AP Press; Late Mortgage Payments Reach High
2/23/07 - CNNMoney; Subprime mortgage lender shares fall sharply
2/17/07 - Knowledge@Wharton; Could Tremors in the Subprime Mortgage Market Be the First Signs of an Earthquake?
2/16/07 - Bloomberg Press; Subprime Mortgage Derivatives Tumble for a Fourth Straight Week
2/13/07 - Goldman Sachs; "Subprime mortgage credit outlook is bleak, prime is fine" (right click "save as" here for a PDF)
2/13/07 - Bank of America; "Short Housing Risk in the Credit Market" (right click "save as" here for a PDF)
10/19/06 - Los Angeles Times; More Homeowners Going Into Default