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[Rob <becida AT comcast.net>]

Crisis Looms in Mortgages

http://tinyurl.com/34kfvf

http://www.nytimes.com/2007/03/11/business/11mortgage.html?ei=5065&en=8ada7b183ae9e61e&ex=1174194000&partner=MYWAY&pagewanted=print

>>At the heart of the turmoil is the subprime 
mortgage market, which developed to give loans to 
shaky borrowers or to those with little cash to 
put down as collateral. Some 35 percent of all 
mortgage securities issued last year were in that 
category, up from 13 percent in 2003.

Looking to expand their reach and their profits, 
lenders were far too willing to lend, as 
evidenced by the creation of new types of 
mortgages ­ known as “affordability products” ­ 
that required little or no down payment and 
little or no documentation of a borrower’s 
income. Loans with 40-year or even 50-year terms 
were also popular among cash-strapped borrowers 
seeking low monthly payments. Exceedingly low 
“teaser” rates that move up rapidly in later 
years were another feature of the new loans. <<