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Daily Real Estate News  |  March 2, 2007  |   About 2.2 Million Home Owners Risk Foreclosure
When the housing market was soaring, lenders often ignored borrowers’ problems because the value of the property was rising.

But with real estate spinning downward, lenders are paying close attention to borrowers who pay late. The result? As many as 2.2 million people are facing foreclosure and could lose their homes, worth a total of $164 million, estimates the Center for Responsible Lending.

In 1995, only 5 percent of all mortgages were subprime. Today, Wall Street analysts estimate they make up 18 to 24 percent of all loans. These are the borrowers that are most likely to be in trouble, analysts say.

While some people are calling for legislation to limit subprime mortgages, the Mortgage Bankers Association defends the use of subprime mortgages and argues against government control.

"Government regulation of this market will result in fewer people having access to credit," says Kurt Pfotenhauer, MBA's senior vice president for government affairs. "If you care about people having access to credit you shouldn't regulate the market."

Source: The Christian Science Monitor, Alexandra Marks and Ron Scherer (03/02/07)

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