CRL Study: Subprime Foreclosures Exceed 1.5 Million Threshold
Washington-A consumer group study finds that 1.5 million subprime mortgage borrowers have lost their homes to foreclosures, and another two million are at risk.
The Center for Responsible Lending study also claims that foreclosures are "rapidly spreading beyond subprime mortgages." The Center noted that a recent Credit Suisse study concludes that one in six outstanding mortgages is currently at risk of foreclosure.
According to the Center, loan modifications "continue to fall behind" the rising rate of defaults.
"Because the foreclosure crisis is at the root of this recession, the continuing flood of foreclosures stymies any chance of real economic recovery," said CRL President Micheal Calhoun. The data is in contrast to Hope Now's figures, which have shown a steady increase in loan modifications.
Hope Now projected in December that servicers would prevent 2.2 million foreclosures in 2008 through loan workouts, which include both repayment plans and modifications. About 950,000 of the total consisted of modifications.