Home Buyers And Owners Feel Pinch Of Rising Rates

MSNBC.com, reports that as adjustable rate mortgages expire, homebuyers are feeling the pain of rising mortgage rates.

Last year, 43 percent of all US mortgages were adjustable or "exotic" in nature.

But borrowing costs have been climbing for two years, in some cases to nearly double what they were in 2003 and 2004, just when the introductory low rates on adjustable rate mortgages are set to expire. That means that homebuyers who were once paying just over 3 percent interest are suddenly facing rates that at 5 or 6 percent and still climbing.

Economist are bracing for an onslaught of late payments and the inevitable worry among lenders and borrowers alike that failed loans will cause a consumer or housing collapse. More...