More Florida Homeowners Face Foreclosure
Florida is now second in the nation in the number of pre-foreclosure filings. Large increases in the interest rates on adjustable rate mortgages, large hikes in homeowners insurance rates, and a slow housing market have left many people in a difficult situation. "Bridge Loan" programs combined with credit counseling may be the solution for many of them.
Tampa, FL, August 15, 2007 --(PR.com)-- A recent study by a research group at Foreclosures.com, that tracks foreclosures across the country, reported Florida had the second highest rate of pre-foreclosure filings in the country, at 17.6 per 1,000 households. Only Nevada had a higher rate of pre-foreclosures, with 25.5 filings for every 1,000 homeowners.
Pre-foreclosures occur when a borrower defaults on a mortgage, but before the home is lost. With home sales still in a slump, and foreclosures on the rise, this new data seems to indicate that the current crisis is far from over. Some economists blame the current situation on unscrupulous lenders putting homeowners in mortgages they couldn’t afford, but that may be only a small part of the problem.
According to Karen Crow, LMB, president of Star Mortgage, Inc., the major cause of the increase in foreclosures in Florida is a “perfect storm” of financial pressures. “Even though some people were given mortgages that they could only barely afford, by lenders that allowed higher than average debt ratios,” she says, “the majority of Florida homeowners that are in trouble now have adjustable rate mortgages (ARMs), and are facing a set of circumstances that no one could have seen coming.”
ARM’s are traditionally considered more risky than fixed rate mortgages, but no lender could have predicted three years ago that the interest rates on existing ARM’s would double in such a short time. Even Alan Greenspan, then chief of the Federal Reserve Bank, in a speech in 2004, had said that adjustable rate mortgages were a better deal for most borrowers.
The last three years have seen a sharp increase in interest rates on all adjustable rate mortgages, as well as large hikes in homeowner’s insurance rates in Florida. Combined with the slump in home sales, this puts many people in a difficult situation. “Many homeowners now find that they can no longer afford to live in their homes, and they can’t sell them either,” Crow says. “Some of them begin to lose hope, and just accept that the foreclosure is bound to happen.”
For most of these people, there is a solution that can save their homes, and help solve their financial difficulties, if they don’t wait too long to get help.
There are “bridge loan” programs, available from some lenders, that can give borrowers get a fresh start, and let them get back on track to repairing their damaged credit, while also allowing them to keep their home.
“We can refinance their current mortgage with a new program that will get them several thousand dollars in cash, let them catch up on their missed payments, and even allow them to skip having a mortgage payment for up to two months, without further damaging their credit,” Crow said.
“Their interest rate and payment usually stays about the same or is slightly higher,” she continued, “but now they have $3000-$5000 cash on hand, to help them make their mortgage payment for the next 12-18 months.”
Star Mortgage also provides their clients with a free Credit Improvement Guide to help them further improve their credit score and re-establish their credit history. If they can keep up with their payments for a year, they should qualify for a new mortgage with much better terms, a low fixed rate, and a lower payment.
Bill Jones, a mobile closer for are title companies, has seen first hand how bridge loans can help homeowners.
“Most of these people are good credit risks and are used to paying their bills on time,” Jones says, “But now they’ve been stressed out for months, worrying about their finances. You can see how relieved they are, when all of the paperwork is finally signed, and they can finally see the light at the end of the tunnel.”
The biggest mistake homeowners who are falling behind can make is to ignore the problem and not try to find help. The longer someone waits to seek help, the harder it is to help them.
“Even if you think it may be too late,” Ms. Crow says, “Don’t wait. You can call us for a free, no obligation consultation anytime. We’ll do our best to find a solution that will allow you keep your home, while helping you save your credit.”
You can contact Star Mortgage, Inc. by calling (813) 882-8878. You can also reach them by email at starmtg@tampabay.rr.com. Their website address is http://www.StarMortgageBroker.com.
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Pre-foreclosures occur when a borrower defaults on a mortgage, but before the home is lost. With home sales still in a slump, and foreclosures on the rise, this new data seems to indicate that the current crisis is far from over. Some economists blame the current situation on unscrupulous lenders putting homeowners in mortgages they couldn’t afford, but that may be only a small part of the problem.
According to Karen Crow, LMB, president of Star Mortgage, Inc., the major cause of the increase in foreclosures in Florida is a “perfect storm” of financial pressures. “Even though some people were given mortgages that they could only barely afford, by lenders that allowed higher than average debt ratios,” she says, “the majority of Florida homeowners that are in trouble now have adjustable rate mortgages (ARMs), and are facing a set of circumstances that no one could have seen coming.”
ARM’s are traditionally considered more risky than fixed rate mortgages, but no lender could have predicted three years ago that the interest rates on existing ARM’s would double in such a short time. Even Alan Greenspan, then chief of the Federal Reserve Bank, in a speech in 2004, had said that adjustable rate mortgages were a better deal for most borrowers.
The last three years have seen a sharp increase in interest rates on all adjustable rate mortgages, as well as large hikes in homeowner’s insurance rates in Florida. Combined with the slump in home sales, this puts many people in a difficult situation. “Many homeowners now find that they can no longer afford to live in their homes, and they can’t sell them either,” Crow says. “Some of them begin to lose hope, and just accept that the foreclosure is bound to happen.”
For most of these people, there is a solution that can save their homes, and help solve their financial difficulties, if they don’t wait too long to get help.
There are “bridge loan” programs, available from some lenders, that can give borrowers get a fresh start, and let them get back on track to repairing their damaged credit, while also allowing them to keep their home.
“We can refinance their current mortgage with a new program that will get them several thousand dollars in cash, let them catch up on their missed payments, and even allow them to skip having a mortgage payment for up to two months, without further damaging their credit,” Crow said.
“Their interest rate and payment usually stays about the same or is slightly higher,” she continued, “but now they have $3000-$5000 cash on hand, to help them make their mortgage payment for the next 12-18 months.”
Star Mortgage also provides their clients with a free Credit Improvement Guide to help them further improve their credit score and re-establish their credit history. If they can keep up with their payments for a year, they should qualify for a new mortgage with much better terms, a low fixed rate, and a lower payment.
Bill Jones, a mobile closer for are title companies, has seen first hand how bridge loans can help homeowners.
“Most of these people are good credit risks and are used to paying their bills on time,” Jones says, “But now they’ve been stressed out for months, worrying about their finances. You can see how relieved they are, when all of the paperwork is finally signed, and they can finally see the light at the end of the tunnel.”
The biggest mistake homeowners who are falling behind can make is to ignore the problem and not try to find help. The longer someone waits to seek help, the harder it is to help them.
“Even if you think it may be too late,” Ms. Crow says, “Don’t wait. You can call us for a free, no obligation consultation anytime. We’ll do our best to find a solution that will allow you keep your home, while helping you save your credit.”
You can contact Star Mortgage, Inc. by calling (813) 882-8878. You can also reach them by email at starmtg@tampabay.rr.com. Their website address is http://www.StarMortgageBroker.com.
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Contact
Star Mortgage, Inc.
Jack Pooley
813-882-8878
www.StarMortgageBroker.com
Jack Pooley
813-882-8878
www.StarMortgageBroker.com
Contact
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