‘Pay option’ loans could swell defaults

By admin on Friday, December 12, 2008
Filled Under: Top News

With 16 years' experience in the mortgage business, Sharren McGarry didn’t believe the “pay option” loan was a good deal for most of her customers, so she didn’t promote it. “I looked at it and I thought: I’m 60 years old. If I were in these peoples’ situation 10 years from now, where would I be?”A new surge in defaults and foreclosures is likely in 2009 and 2010 as as risky “pay option” mortgages reset to sharply higher monthly payments.


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