Industry Professionals share insights into mortgage crisis
During 2007, nearly 1.3 million U.S. housing properties faced foreclosure. The Adams State College Community Partnerships held a workshop to help the local community understand and deal with the mortgage crisis, on June 12.
Guest speakers included Marcia Waters and Cary Whitaker, Denver's Colorado Division of Real Estate; Roy Clennan, president of Mortgage Solutions of Colorado and Mountain West Home Loan of Alamosa; and Bill Fassett, Chief Lending Officer at the San Luis Valley Federal Bank.
High default rates on sub-prime and adjustable rate mortgages made to higher-risk borrowers led to the mortgage crisis. "Colorado no longer leads the nation in foreclosure rates," said Waters, investigations and compliance director. Nevada, Arizona and California are the three states with the highest foreclosure rates.
Predatory lending practices from a relatively small number of lenders are also to blame for the mortgage crises. According to Whitaker, administrator of the new mortgage broker program, since the inception of the Colorado mortgage broker licensing program a year ago approximately 500 complaints were filed in Colorado and more than half of those complaints were dismissed because they superseded the Colorado mortgage brokerage laws.
Clennan said prospective buyers should find a loan within their budget and then locate property within that price range. He added the San Luis Valley may not be as hard hit by the mortgage crisis compared to the rest of Colorado.
According to Fassett, various counties in the valley may see a higher rate of foreclosures than previously seen. "However, the overall quality of our loan portfolio has been very consistent and loan foreclosures have been very low," he said. He suggested homeowners communicate with their lenders. "Most lenders, especially local banks who retain servicing on their home loans, would rather explore all alternatives to work out of a loan delinquency rather than foreclosing. We view foreclosure as the last and least desirable solution to an unfortunate situation."
Consumers can research mortgage brokers and view an interactive video at http://www.dora.state.co.us/Real-estate/.