| While you weren't watching ... ... mortgage rates were tumbling
With long-term mortgage rates sinking to their lowest level since March 2004, it looked like one of those golden opportunities to refinance the home or condo this week.
But many who rushed out to their banker or mortgage broker discovered that it is much more difficult to borrow money than it was even a few months ago.
The real estate crisis dragging down the rest of the U.S. economy has frozen the market for many borrowers. As prices fall and lenders wallow in a sea of losses, only those with gold-plated credit ratings and ample equity in their homes are sailing through the application process, mortgage bankers said.
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April 2007
Ospreys, the only raptors that dive fully into the water for fish, were nearly wiped out in New England by our postwar use of the pesticide DDT. But we are in the middle of an osprey renaissance, and, thanks to their booming population and outgoing nature, the birds have become a visible presence on Cape Cod and other coastal areas. Ospreys are easy to observe at their large shaggy nests (they are pack rats, filling the sides of their homes with string, plastic bags, and, in the case of one Cape nest, a naked Barbie doll). But if you get too close, they might drive you off with a dive-bombing maneuver and their characteristic warning cries. Because of the way the ospreys defend and commit to their nests, most observers think of them as homebodies. But there is another side to osprey life and another half of the year, during which "our" New England birds become world travelers.
New alarm: Option-ARM 'liar's loans'
The no-worries lending that inflated the housing bubble is resulting in a flood of soured option-ARM loans, adjustable-rate mortgages that allow borrowers to pay so little every month that their loan balances rise rather than fall, sometimes sharply.
Numbers from industry trackers suggest that these borrowers, most of whom boast respectable and often top-tier credit scores and appear to have substantial incomes and home equity, are starting to create a second tide of defaults for lenders swamped by the meltdown in subprime loans made to people with bad credit or overstretched finances.
Countrywide Financial Corp., the top option-ARM lender, will be hit hard. Already reeling from the subprime mess, Countrywide was rescued from possible bankruptcy this month by Bank of America Corp., which agreed to acquire it for about $4 billion.
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