Article in today's "Starbulletin"

[Beachboy]

I feel for the people who have ARM's that are gonna reset this year! But for some it was the only game in town for them to become homeowners. I think most should try to refianace their mortgage..

http://starbulletin.com/2007/07/06/busin...ory01.html

[Chunkster]

It isn't so much that interest rates have skyrocketed, because they are still in the low range historically. The real problem is the teaser interest rates that were used to get sub-prime borrowers into homes that they could not afford otherwise. Not only did some unscrupulous mortgage brokers sign up people for loans with ridiculously low teaser rates, but they also put really high margins above prime into the contracts for figuring later escalations. (This was necessary to make the loans marketable in the resale market.) It should be noted that many borrowers did not carefully read the contracts or stop to consider that equity appreciation might not perpetually take care of the gaps in their financial plans.

Now that the lending industry has realized the fallacies of past practices, loan requirements have been tightened. Thus, refinancing is no longer an option for the most threatened homeowners. Sadly, many will lose their homes.