Many homeowners with adjustable rate mortgages are finding their rate too high to keep up with the payments. This problem is really hitting home owner in the Wiregrass for some people.
The problem is some lenders have allowed people with bad credit to borrow money for a mortgage and now that their rates have increased some are having to sell their homes.
Many home owners who took advantage of the low adjustable rate mortgages several years ago are finding their mortgage rates adjusting to the high end.
Even people with good credit are having a hard time keeping up with the payments.
"The letter his rate increased three percent on October 1st his mortgage will increase from $1,400 to $1,900, that's an increase of $477 a month," said Marsha Cobb of Compass Bank Mortgage.
Foreclosures are expected to continue increasing for the next year, but local lenders say there are steps you can take to protect your home.
"If a customer finds they are in a position they need to contact their lender before they reach foreclosure status," said Cobb.
Local realtors are optimistic that the market will stabilize in the near future.
Charles Buntin, Tom West realtor says "It's slowed down a little because of schools starting back, but the market is strong especially for buyers." says
Local lenders say if you are in the market to buy a home make sure you find a reputable, local lender who has a strong reputation.
Cobb says be careful about doing business over the internet.
The lender says it is a common misconception that if you have had bad credit in the past, like you filed bankruptcy, you can't get a loan through a bank or reputable lender.
There are many safe options available to help you finance your home; you just have to take the time to ask. Remember, they say there's no such thing as a dumb question.
Not all lenders have to comply by the same laws, so before signing with a lender you need to make sure they are reputable and understand your individual circumstances.