News Article From: 12-05-2007
Many Subprime Borrowers May Be Able to Refinance, an article from RealEstateJournal.com, reports that according to Eric Rosengren, president of the Federal Reserve Bank of Boston, many borrowers with subprime mortgages have reasonably good credit and may be able to refinance into a less costly mortgage by taking advantage of government programs. Using research conducted by members of the bank's staff, Mr. Rosengren noted that 55% of subprime adjustable-rate mortgages, where the owner occupied the home, hadn't missed a mortgage payment in the past year. That percentage represents about 1.2 million borrowers. Rosengren said, "These subprime borrowers may meet the credit standards required for FHA (Federal Housing Administration) guarantees or for similar state programs, with potentially a significant savings." He also called on lenders to expand their efforts to refinance these subprime borrowers and to take a "fresh look" at the FHA program.