Pennsylvania Subprime Mortgage Loan Lawyers

As with subprime lending in general, subprime mortgages are usually defined by the type of consumer to which they are granted to. Lenders offer subprime mortgages to borrowers who may have:

• Weakened credit histories
• Delinquent payment records
• Charge-offs
• Judgments
• Bankruptcies

Subprime lenders may also display a reduce payment capacity ­ measured by their low credit scores (below 620 on the FICO scale) and debt-to-income ratio (high debt and low income). It has also been found that subprime loans are granted to borrowers who do not have legal immigration status in this country.

Subprime mortgages accounted for 21% of all mortgage loans between 2004 and 2006. These numbers were up 9% from the years 1996 through 2004. A total of $600 billion in subprime mortgage loans were given in the year of 2006, accounting for 1/5 of the nation’s home loan market. Now, only a couple years after the peak of subprime mortgages, we are seeing record setting foreclosures. These statistics are not coincidence.

Types of subprime mortgages include:

• Interest-only mortgage ­ this type of mortgage allows the borrower to pay only the interest for a set period of time (typically 5-10 years)
• Pick-a-payment mortgage ­ this type of mortgage allows the borrower to pick their monthly payment (full payment, interest only, or minimum payment, which may be lower than the payment required to actually reduce the amount of the loan.)
• Initial fixed rate mortgage ­ loans that begin with a fixed interest rate and quickly transfer over to a loan with variable rates. Some examples are: 2-28, 3-27, and 5-25. The first number is the number of years the loan remains at a fixed rate while the second number indicates the remaining life of the loan at an adjustable rate.

If you have been involved in a subprime loan, you may be the victim of unfair lending practices, predatory lending or other financial wrongdoings. It is important to have a strong legal team on your side when dealing with such complicated and complex issues. Please call one of our Pennsylvania subprime lending lawyers at Anapol Schwartz to discuss your case.

CALL TODAY 866.735.2792