An Unfortunate Sign of the Times...

According to the article in the Globe and Mail, some borrowers who bought homes and/or arranged mortgage financing with sub-prime lenders during the height of the boom may not be able to renew their mortgages. Since the global credit crisis hit, many sub-prime lenders no longer have access to funds to lend out. These mortgage loans were sub-prime and therefore riskier and many sub-prime mortgage lenders have had their sources of funding dry up. If the sub-prime lender doesn’t have the funding to renew the mortgage, the property has lost value (in a negative equity situation), and the borrowers don’t qualify at a regular lender then the mortgage may not be able to be renewed. If the mortgage cannot be renewed the homeowners will be forced into foreclosure (even if they were making all of their mortgage payments).
This is a really unfortunate situation for everyone involved. According to the article, some of these sub-prime mortgage lenders are lobbying Ottawa for some help. Let’s see what happens!
Read the Globe and Mail article here...