TAMPA - As Congress hashes out the details of the mortgage bailout plan, another wave of problem loans will soon come crashing down, especially in Florida.
Nearly $100 billion worth of loans are deemed at risk for foreclosure during the next two years nationwide as borrowers with adjustable rate loans, called option-ARMs, see rates adjust, some ahead of schedule, according to a report released this month by Fitch Ratings.
Some borrowers with those loans are being notified now about payment changes, and the majority of those loans will reset in 2010.
"The average increase in mortgage payments will be 65 percent," said Alla Sirotic, senior director for Fitch. "Payments could jump by as much as 100 percent for some people. If you can't get out of the mortgage or pay that payment, you'll be in default."
This is of particular interest to Floridians hoping the government's bailout will jump-start the state's healing process after hundreds of thousands of foreclosure filings. That's because many of the loans scheduled to reset are in the Sunshine State.
"California will be the hardest-hit, and Florida will be right behind," Sirotic said.
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Florida Faces More Turmoil On Mortgages
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