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Adjustable Rate Mortgage Reset Schedule (GRAPH)

ARM graph

This graph is a good indicator of what is to come (and when). It shows that subprime ARM resets will hit their peak in the next few months, while the Option ARMs, Prime ARM, and Alt-A ARM resets will peak in the next 36 months or so.

The sheer numbers are staggering, especially in the subprime market: $35 billion in subprime ARMs will reset in the coming months, and I believe that these are the problem loans. I'm sure that a sizeable amount of these loans are high LTV mortgages, and in a declining market, these loans will be nearly impossible to refinance, whether FHASecure is available or not. Keep in mind that HUD estimates that only 250,000 borrowers will be able to qualify for FHASecure.

I guess the good news is once we get past the next 6 months or so, the market should be in better shape. Most Option ARMs, Prime ARMs, and Alt-A ARMs have lower LTVs and higher credit scores, and for the most part, these borrowers should be in a better position to refinance to a fixed rate.

Posted by Gareth Bourriague - Benchmark Mortgage on 09/12/2007 12:36 PM

Comments (20)

adjustable rate mortgage, arm, fixed rate mortgage, benchmark mortgage, louisiana mortgages

20 Comments on Adjustable Rate Mortgage Reset Schedule (GRAPH)

SEP

2007

Excellent Graph. I had written on the several times. I wish I had used a graph,:-) Nice post! We will get through this and we will see the market pick up by the end of next year if not sooner, especially if Bernanke does the right thing next week. Lower the rates.

Great post and I too like the graph. I think it will help some when the media hype slows down on the subject.

very nice chart. when consumers see it they will be impressed a little.

SEP

2007

Thanks for the comments guys!

MAR

2008

My 2 cents ... Personally, I feel that I was just kicked in the face when I heard that $20 Billion in tax payer backed funds were used to bail-out a Wall Street Investment Banker. Surely this money could have been better spent if it had gone to pay the refinance fees to get everyone with an ARM, no matter what their current credit rating or how far they may be behind in their current ARM mortgage payment, out of their ARM and into a 30 year, FHA fixed rate mortgage!

JUN

2008

Uh, they didn't spend $20B, they loaned it and are earning interest on it...

AUG

2008

Great post and I really like the graph :-) You can see current mortgage rates from lenders across the nation on our site. Pretty fun stuff :-)

SEP

2008

Its true that the worst of the subprime is behind us, but I don't espect the market to recover until late 2011 or early 2012. The option ARMs are coming due, and this being combined with continued loss in real estate value will extend the market depression for years. PITI Calculator

OCT

2008

Very helpful in tracking traffic potential for refinance of these ARMS!

Great day, Wanda

NOV

2008

Well it looks like we are now past the majority of the subprime resets but we have three more years of resets ahead!

www.gibbons-realty.com

DEC

2008

Thanks for the great information.

DEC

2008

yeah! we're in much better shape now. lol

DEC

2008

I've been preaching about the hurricane of reseting ARM's for the last 2-3 years. My company had high quotas on the number of Option ARM's we needed to close on. Roughly 40% needed to be an ARM. A hurricane of foreclosures is going to hit us in 2011. William, you're in real estate and you honestly thought the housing market would be out of the woods in late 2008? What were you smoking, man!?

FEB

i work in commercal sector and i don't see the resets for that for 2011 has this been take into account?

JUL

Mark, here's a better graph illustrating the time schedule better:

http://www.doctorhousingbubble.com/wp-content/uploads/2009/06/businessweekoptionarm1.jpg

You can see that 2011 is going to be a hell of a year.

SEP

So, how many months after the peak can we expect to see foreclosures? Does anyone know the average amount of time it takes to foreclose in California? Thank you.

OCT

THANKS FOR THE GRAPH, IT IS HELPFUL.

DEC

Here it comes!

DEC

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JAN

Thankfully, foreclosures are not a major factor in the St louis market.

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Gareth Bourriague - Benchmark Mortgage

Baton Rouge, LA

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