For Mortgage Defaulters, More Loans for the Taking

Annamaria Andriotis (Smart Money)

June 1, 2011

“After years of turning down all but the best borrowers, banks and other lenders are now extending credit to a surprising group of customers: former homeowners who defaulted on their mortgages…. The banks approving these loans consider these borrowers a special group, says Steven Chaouki, a vice president for financial services at TransUnion: Because they are current on all other loans, banks see them as a lower risk relative to borrowers who have missed payments on multiple loans. The housing bubble and bust put otherwise responsible borrowers into bad situations, says Marcus Stanley, policy director at Americans for Financial Reform, a public interest advocacy group. “A lot of responsible people through no fault of their own found themselves in mortgages that weren’t practical for them.”  Click here for more.