Some took out credit card loans and second mortgages to get into the AmiWorld investment.
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Well, interest rates for that are less than those you pay on credit-card debt or for second mortgages.
This could be in the form of mild to severe property damage, unpaid HOA fees, taxes, second mortgages and various other liens.
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Homeowners with second mortgages or other liens won't be selected.
It was often to pay those rising costs that families accepted the home equity lines of credit and second mortgages that contributed so much to inflating the housing bubble.
Another concern: Many borrowers who are underwater have second mortgages, which are primarily owned by banks, sitting behind the first mortgages that are primarily owned by Fannie, Freddie, and private investors.
The real estate boom and low interest rates have allowed people to squeeze more money out of their homes by refinancing or taking out second mortgages on suddenly much more valuable property.
One involves a major sticking point for many servicers who have tried to modify mortgages to more affordable terms: How to handle the millions of homeowners with second mortgages or home equity loans.
Allowing interest deductions on mortgages for second homes obviously does not advance the goal of home ownership.
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The China Banking Regulatory Commission has warned banks to stick to rules on mortgages for second homes, which require a down-payment of at least 40% of a property's value.
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Once traditional lending standards were trashed, higher income borrowers joined the party as well, with mortgages to speculate in second and third homes.
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The government has sought to deter speculation in China by raising capital gains taxes, limiting second-home purchases and capping mortgages, but prices are still climbing in most cities.
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Nici Audhlam-Gardiner, head of mortgages at Abbey, Britain's second-largest mortgage lender, says that brokers who previously steered business to now-defunct or struggling players are now turning her way.
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Lenders or investors holding those second liens typically suffer the biggest losses when primary mortgages are modified, so winning their approval to modify loan terms has been difficult.
Among the revelations were claims for expensive TVs and furniture, MPs who claimed for more than one property by "flipping" the designated second home and others who over-claimed for mortgages or services.
Investors fear that the same lax lending standards that caused banks to write down nonperforming home loans, will cause a second wave of weakness, as defaults increase on commercial mortgages.
Remember, the biggest source of capital for new businesses in the U.S. is mortgages--people either increasing an existing one or taking out a second one on their home.
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