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NEW YORK (CNNMoney.com) -- Mortgage rates have been trending down, but that won't do much to benefit those who signed up for low-teaser-rate adjustable-rate mortgages in the past few years. An ARM charges an initial discounted rate for a period of time, after which it adjusts to market levels. When some types of ARMs with teaser rates of 2 percent or less reset, the rates are likely to jump to more than 6 percent - and even as high as 9 percent. Home for sale profiles Help! Young and Ballanco The Orlando-based couple thought they were in a bubble. Are...

Risks of recession continuing to rise Economy is slowing, showing warning flags By Will Deener Dallas Morning News Published October 9, 2006 Excerpt: A recent Merrill Lynch economic report said that as much as half of the nation's economic growth is related to housing sales, construction and spending from home equity loans. "The worry here is that a housing decline will have a disproportionate impact on the American consumer," said Gordon B. Fowler, chief investment officer at Glenmede Trust Co., a Philadelphia money management firm. "Prices went up so much in recent years that now as they come down, it...

Just how weak is the Boston real estate market? We got an idea yesterday. And if you’re looking to sell your home in the near future, the news isn’t good. Brand-new luxury condos downtown saw hundreds of thousands of dollars wiped off their value in the Hub’s first public real estate auction in a decade. The 31 condos up for sale in the Folio building on Broad Street sold on average for 30 percent below their asking prices. Some barely fetched their minimums. Even the building’s marketing boss couldn’t hide what happened. “I think the buyers got a better value...

Lenders must consider borrowers' ability to pay the full cost of the loan WASHINGTON (MarketWatch) -- Cracking down on exotic mortgages that have exploded in popularity in recent years, U.S. regulators told banks Friday that they've got to make sure that borrowers can actually pay back the full amount of the mortgage. Exotic products, such as interest-only or payment option adjustable rate mortgages, allow borrowers to trade lower initial payments for higher payments later. But such products have raised red flags at the Federal Reserve and other banking regulators as more institutions offer them and they become available to a...

It seems like every month, I'm running into people passing out a slick new business card that announces them as a real estate agent or mortgage broker. Who wouldn't want to get a piece of the action? On certain Portland streets, housing prices are doubling in a matter of months. And when there's this kind of temptation to make quick money, greed can't be far behind.Insiders call it land flipping. Silent second. Straw buyers. Foreclosure fraud. Equity skimming. Air loans. If there's a thought to do it, there's a scheme attached to it."It's the fastest-growing white collar crime in the...

One of the many benefits of the now-cooling housing boom — both to consumers and the U.S. economy — was the huge pile of cash extracted in the form of home equity loans and “cash-out” mortgage refinancings. But with home prices flattening, and that multibillion-dollar piggy bank drying up, can consumers continue the shopping spree that accounts for more than two-thirds of the U.S. economy? There was fresh evidence of the housing slump this week, as separate government reports showed prices of both new and existing homes fell year-over year in August. For existing homes, it was the first year-over-year...

Gerard Herard was able to finally purchase a home in 2003 through a $225,070 mortgage from Security Atlantic Mortgage. His payments on the quaint Totowa Avenue house in Paterson were a reasonable $1,300 a month. But Herard's payments have since increased to $2,200 a month and the mortgage has grown, not shrunk, to roughly $300,000. Herard is not entirely sure why his situation changed so dramatically and is struggling to deal with the increase. "I'm trying to climb a steep ladder," said Herard, 53. In recent years, lenders have lured scores of homeowners to untraditional mortgages with changing terms. Many...

No Shortage of Bubbles and Troubles By Jim Jubak MSN Money Markets Editor 9/27/2006 The stock and bond markets rallied after the Federal Reserve held short-term interest rates steady at its Sept. 20 meeting. Investors believe that the Fed has successfully steered the economy between too hot and too cold, and that we're headed for a just-right soft landing with inflation under control and the economy growing at a solid pace. The so-called "Goldilocks economy" will push both stock and bond prices higher. But I think it's premature to slap the Fed on the back and say "mission accomplished." The...

Sep 20, 2006 4 Major California Home Markets See Drop In Prices (AP) LOS ANGELES A real estate research firm says the median price of a California home increased last month at the slowest annual rate in nine years. Four counties actually saw price declines. Among the largest real estate markets, according to DataQuick Information Systems, the steepest drop was 6.7 percent in San Mateo County. Other decreases were seen in Marin County (2.3 percent), San Diego County (2.2 percent) and Alameda County (1.5 percent). Appreciation in Sonoma, Santa Clara, San Francisco and Contra Costa counties was essentially flat. The...

As rates creep up, borrowers with interest-only loans face sharply higher mortgage payments: Tina Gren Clarence saves $600 a month with an interest-only loan she took out about a year ago for a Petaluma home, yet already is considering heading off the financial hit when her monthly payments could jump. And Peter Shidler, whose low-payment-option loan could turn from a sweet deal into a potentially bitter one, is refinancing and still will pay $500 more monthly on his Santa Rosa home. Gren Clarence and Shidler, like two out of three Sonoma County home buyers and owners, joined the fast-growing club...

Reality setting in on real estate September 2006 American’s castles (homes) are middle class walls of separation from poverty and want. As goes the house goes the family’s ability to fend off tough times and leverage past wealth for opportunity. Borrowing to bridge low income periods, college costs, medical expenses, bail, renovations, retirement and unemployment are all common. This is the proper frame of discussion for the impending debt/depreciation storming of the castle. A few basic facts are worth repeating. $1.06 Trillion in residential mortgages were written in 2005. Nearly 70% of Americans own their residences. The home is by...

FALMOUTH, Ky. - Used boots fetch $3 and old salt-and-pepper shakers bring in a buck at a makeshift flea market along Highway 27, presumably not what President Bush and Republicans have in mind when they herald a vibrant economy. ADVERTISEMENT Times are "very good for the rich and very, very bad for the poor" who "can't afford to live," laments Larry Mitchell, 43, a now-and-then merchant peddling his wares recently in a submarine sandwich shop parking lot. He says the middle class is "having a hard time." In the Ohio River Valley, where people decry high gas prices, stagnant wages,...

NEW YORK (CNNMoney.com) -- The number of homes entering into some stage of foreclosure is surging, according to a survey released Wednesday. In August, 115,292 properties entered into foreclosure, according to RealtyTrac, an online marketplace for foreclosure sales. That was 24 percent above the level in July and 53 percent higher than a year earlier. Where foreclosures are jumping Year over year gain in homes in foreclosure. Click for more stats on each state. Nevada: Up 255% California: Up 160% Florida: Up 62% It was the second highest monthly foreclosure total of the year; in February, 117,151 properties entered foreclosure....

WASHINGTON (Reuters) - U.S. lawmakers will question some leading government and industry economists about the perils of a possible 'housing bubble' in a Wednesday hearing. Lawmakers wanted the session "because we've heard a great deal about the possibility of a housing bubble for several years now," said Sen. Wayne Allard, a Republican from Colorado. The hearing, "The Housing Bubble and its Implications for the Economy," will be held in an open session of the Senate Banking Committee at 10 a.m.. Next week, the same committee will hold a hearing on the growth of innovative mortgage products that have mushroomed along...

He, of all people, should have known better. The president of the National Association of Realtors, Thomas M. Stevens of Vienna, admits he didn't follow his agents' advice when the real estate market started to cool. That, he says, is why his old house in Great Falls has now been on the market for a year at the price of $1.45 million. "What I should have done," confessed the senior vice president of NRT Inc., parent of Coldwell Banker Residential Brokerage, "was listened to my agent and cut the price by $50,000 to $100,000 early on, and the property would...

NEW YORK (Reuters) - Investment bank HSBC has revised downward its forecast for 2007 economic growth and cautioned that the risk of an outright recession is growing as a retreat in housing threatens household balance sheets. ADVERTISEMENT The company argues that while corporate profits have remained sky-high, the incomes of most Americans have effectively fallen over the last 18 months. That, say economists Stephen King and Ian Morris, could be a recipe for hard times in an economy that relies on consumers for over two-thirds of its strength. "Never before have households been so hard hit at a time companies...

Falling prices have created a new twist in the suburban Boston real estate market: More homes are selling for less than their assessed values. Massachusetts house prices slumped 3.5 percent in July, the biggest monthly drop since 1993, as a slowdown in sales brought about by rising interest rates created a glut of homes on the market. which are the estimated values communities place on homes to determine property taxes, their primary source of revenue. State law requires communities to assess properties at ``full and fair cash value." * * * But for the past five years, most homes sold...

WASHINGTON (Reuters) - U.S. home sales will be a good deal weaker this year than earlier thought as potential buyers remain on the sidelines waiting for better deals, a national real estate group said on Thursday. ADVERTISEMENT The National Association of Realtors said sales of existing homes were likely to drop 7.6 percent this year to 6.54 million. A month ago, the group thought existing homes sales would fall only 6.5 percent to 6.61 million. The association, which said housing prices were likely to dip temporarily below year-ago levels, also revised lower its forecasts for new homes sales and housing...

With millions of adjustable-rate mortgages about to reset this fall, experts expect a wave of foreclosures by Americans in every income bracket. Here's why they could soar in late 2006 and beyond: Those easy-mortgage chickens are coming home to roost. This fall the adjustable-rate mortgages (ARMs) that millions of Americans took out during the recent housing boom will be reset, and many homeowners will see their monthly mortgage payments shoot up by as much as 20%. According to the Mortgage Bankers Association, of all mortgages financed in 2005, 36% were ARMs -- the highest ever. This is a matter of...

The US economy has been generating strong economic growth over the past few years as it has come out of recession. After growing at more than 3% a year in 2004 and 2005, the pace picked up to a blistering 5.6% annual rate in the first quarter of this year - although the pace has since then slipped back to 2.9%. So far, though, little of that growth has translated into the hands of the average worker, according to new research from the Economic Policy Institute (EPI). Click here for a graph of wages vs. productivity For real household incomes,...