Friday, September 23, 2005

Katrina Victims Face Default

CNN Money reports that some Lousiana hurricane victims may be forced into default. "Hurricane Katrina victims with weak credit are getting shorter grace periods from mortgage lenders than their better-off counterparts."

"Homeowners with damaged credit, who pay higher rates for their mortgages, known as sub prime loans, could face foreclosure on their homes as soon as the end of the year, according to a statement from community advocacy group ACORN."

"'Subprime borrowers are not getting the same treatment,' said ACORN Chair Alton Bennett. Among people displaced by Hurricane Katrina, many borrowers with better credit were allowed to delay mortgage payments by three months, and in some cases for up to 12 months, the report said."

"Meanwhile, subprime borrowers were often only given relief from their mortgage payments and waivers for late payments for the month of September."


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