The Mortgage Mess Part 2

If you miss three house payments there's a good chance your home could be at risk for foreclosure.

Statistics show more and more Tennesseans are finding themselves in that position, because they took out mortgages they can't afford.

Every week on the Metro Courthouse steps, lenders hold a foreclosure auction. These days investors have a lot to choose from.

"There's probably 80 per week that get scheduled," said local investor Dale Hire. "About half of those get foreclosed."

Hire believes it has a lot to do with what lenders call sub-prime loans, or more simply loans for people who wouldn't normally have the credit to qualify.

North Nashville resident Beverly Bowman is among them. She took out a Sub-Prime loan two years ago to refinance her house. Only to discover in July, her mortgage payment was going up more than $300 dollars a month.


"If I pay that, I can't pay the rest of my bills that I have to pay," said Bowman

Like many Americans, Beverly signed up for an adjustable rate mortgage where the interest rate is low for the first two years. Then it rises sometimes hundreds of dollars.

Beverly says her lender didn't explain that part of the loan much less let her know she may qualify for a fixed rate that never goes up.

"They didn't tell me really nothing. They just said we can help you refinance your home and that was it," said Bowman

As the bills piled up Beverly says she missed three house payments. Now she's trying to refinance her home to keep it safe from foreclosure.

Bankruptcy attorney Mary Beth Ausbrooks says she sees clients everyday with the same problem.

"People all they're looking at is they're getting the home of their dreams that they've always wanted. It's at a very affordable payment and life is good," said Ausbrooks.

That is, until the payment goes up. Bowman says her payment is now so expensive, if she can't refinance, she'll try to sell.

"Maybe it's time to move on cause I can't keep all this on my mind about if I'm going to stay here. Do I have to move, can I sell it," said Bowman.