The Top 10 Reasons

1. CNN reported today that foreclosure filings are up 120% more in the second quarter of this year than what they were this time last year. It really should come at no surprise to anybody.

2. Right now a lot of people that took out adjustable rate mortgages from 2003-2005 are starting to see their interest rates finally adjust on them and are trying to deal with the increased payments. Many of these same people that took aout an adjustable rate mortgage also took a home equity line of credit when their property was increasing in value. They also took out their home equity loan right up to 100% of the value of the home more than likely to pay off credit card debt or other things they did not need. Now they have two loans combined and owe around 125% of what the home

1. Mortgage companies starting around November 2007 stopped doing fixed second mortgages and home equity lines of credit (HELOC) due to changes going on in the mortgage industry. A lot of swift and sudden changes came to the type of companies that were farthest away from the actual money like the mortgage brokers, correspondent lenders, then the banks.

2. The banks are the one’s that set the guidelines for anybody who does business with them. Since a mortgage broker does not lend you the money (the bank does that the mortgage broker works with) they were told that they would not be honoring anymore fixed second mortgages or HELOC’s. This lead to a mad dash from all of the smaller companies to close these loans so they could sell them to the bank before the deadline or they would not be able to close.

3. What lead to this rush

1. For those of you that do not know what a second mortgage is, it is a lien (loan) against a certain percentage of the equity of the home. What the mortgage company does is recognizes that you have a first mortgage on your home and they take the balance of that loan, get an appraisal on the home and say you have this amount of equity in the home. As an example, you have a first mortgage of $125k and the home is worth $200k, this gives you equity of $200k – $125k = $75k. Depending on what mortgage company you go with and what their guidelines are you could take out a second mortgage up to 100% of the value of the home.

2. During the real estate boom some lenders did second mortgages up to 125% of the value of the home because during that time the value of

1. The housing boom is turning out to be quite a bust right now. There were a lot of people that got rich very fast and now there are some people that are in the poor house. What is interesting is that you would never think that the person who probably did three refinance loans for you on your house is probably in worst financial shape than you are in right now.

2. It does not take that much to be a mortgage broker, loan officer, mortgage banker, etc.. You do not need any type of training or certifications. Some states make you take open books tests that you do online and its more like you pick an answer, it says your wrong, you keep guessing until you get the right one and then you move on. Not that hard. All it really takes to be a successful mortgage person is

1. First off I want to say that I am not promoting going into foreclosure but let me tell you something about when it makes sense to do it. Foreclosure is now a word that every American now knows. Ten years ago you might hear that word occasionally or maybe when a business was going bankrupt, but not as much as you do now. The mortgage industry is having the worst time of its existence and their is not one person who is not affected by it one way or another. This is a story for the people who can pay their mortgage but need to move or downsize or something else but just cannot sell their house.

2. Many people around the country are losing their jobs right now because the economy is heading or already is in a recession. When people don’t have the money coming in to pay their bills the bills do not

1. A mortgage company is in the business of making loans not being a property manager. All that they like to do is make money by selling mortgage notes to other institutions and making quick cash or by holding onto the note and collecting the interest.

2. If a borrower misses 4 payments in a row the lender has the option to start foreclosure proceedings on the home. It is in the contract you signed with them and they are only doing what the contract says.

3. After you have missed 4 payments the bank holding the mortgage note has not received 4 months of interest on the principle balance they lent you. As an example a loan at $200k at 6% interest would have a principle and interest payment of $!200 a month in which $1000 of that is strictly interest. It sucks seeing that number.