Boston Real Estate for Sale

Even more data to interpret.

The Federal Reserve Bank of Boston released a fantastic report yesterday entitled, “Subprime Mortgage Problems: Research, Opportunities, and Policy Considerations.

It’s a good read, but let me summarize part of it into three four simple sentences, courtesy of Inman News:

The study, of the Massachusetts housing market from 1989 to 2007, found homes originally purchased with a subprime purchase mortgage ended up in foreclosure about 18 percent of the time, or more than six times as often as those purchased with prime purchase mortgages

About 30 percent of foreclosures in the state during 2006 and 2007 were traced to homeowners who used a subprime mortgage to purchase their house.

A higher percentage ” almost 44 percent of foreclosures” were on homes whose last mortgage was originated by a subprime lender.

About six out of 10 of those borrowers had originally purchased their home with a prime mortgage, and then refinanced into a subprime mortgage.

I think that last part is disturbing. Six out of ten borrowers who ended up in foreclosure had purchased their homes originally with prime mortgage loans, but then refinanced into subprime mortgage loans.

This means they took a “cash-out” refinance, most likely. Meaning, they took the money out and spent it, either on home renovations (surrrre …) or, more likely, new Lexuses (Lexi?).

Source: Price declines will determine extent of subprime crisis – Inman News (subscription required), by way of Matrix

Contact me to find out more about Boston condos for sale or to set up an appointment call/text 617-595-3712.

Back to homepage Boston condos

Boston condos for sale

SEARCH FOR CONDOS FOR SALE AND RENTALS

For more information please contact one of our on-call agents at 617-595-3712.

Updated:  1st Q 2018

Call Now