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as filings rise FICO scores slide

As previously pointed out in this post bankruptcy filings rose across the board in the first 3 quarters of 2006 even as high FICO scores have become even harder to come by. So while just over half the population has a score of 700+ (“safe” according to the industry) only 1 in 10 enjoys a “perfect” score of 800 to 850. The rest of us have an average FICO score of less than 620. This so-called subprime group of consumers is prayed on by mortgage brokers and real estate quick-sale artists peddling mortgages with such dizzyingly high interest and such hard to understand don’t-ask-don’t-tell terms that they amount to 30 year credit cards. No wonder the Associated Press reported that late payments on auto and home equity loans climbed in the final quarter of last year and the American Bankers Association said late payments on home equity lines of credit were sharply higher than last year and the highest since first quarter 2006. Of course the weak housing market contributed as well.

Ed. Note: payments are delinquent if they are 30+ days past due.

If you are a homeowner frustrated by the market’s wild swings or are still trying to figure out how payments on your adjustible rate mortgage got out of control (“it seemd so reasonable at first …”) then you are not alone. Visit us at M. Hedayat & Associates, P.C. to learn what we can do to help; you can also call 630.378.2200 or e-mail me at mmhedayat1@gmail.com to tell your story. All contacts are in strict confidence.

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