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Subprime Mortgage Mahem


It seems as of late a bit of a hysteria has been created within the mortgage bankers world, specifically the subprime market, where numerous lenders have been forced to close their doors permanently or at the very least cease and desist all subprime lending (risky, higher interest rate, 100% financing loans to parties with no income documentation and/or poor credit scores basically).  Sub prime loans accounting for roughly 10% of the entire mortgage security market and the question one asks is will the reverberations seen in this market carry over into the conventional mortgage markets.  In Maine, the Association of Realtors reported that the Maine real estate foreclosure rate for the 4th Qtr 2006 was 4.9%, 21st in the nation and 2nd highest in New England with only Rhode Island ranking higher at 5%.  A few recent articles from the New York Times detailing the issue in more depth:

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