More subprime borrowers falling into arrears
More subprime borrowers falling into arrears
Friday 29th August 2008
Standard & Poor's, a leading credit rating agency, has discovered 23.31 per cent of homeowners who took home loans despite their impaired credit ratings are now in arrears.
This is the highest level ever recorded and is up from a figure of 22.17 per cent in the first quarter.
Kate Livesey, a credit analyst, told the Associated Press: "The rise in delinquencies is being driven by affordability pressure, especially for those borrowers whose loans are resetting to higher floating interest rates.
"In the past, they would have had a wide range of refinancing options, but the sharp contraction in credit availability means refinancing is more difficult, and some borrowers are now struggling."
Borrowers struggling with mortgage debt are urged to approach a debt management company for advice on possible solutions such as individual voluntary arrangements (IVAs) and debt consolidation loans.
Are you considering an IVA? We can help
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