Fueled by the mortgage crisis, personal bankruptcy is reaching all levels of the income spectrum -- from affluent professionals to lower-income subprime borrowers, bankruptcy lawyers said.
"I have doctors, Realtors, mortgage brokers and all kinds of people who had rental properties who are in trouble now," said Andrew Baron, a consumer-bankruptcy lawyer in Orlando. "These are people who never dreamed they'd be facing this kind of situation. And they'll resist until the bitter end before they file bankruptcy."
Exotic interest-only loans or adjustable-rate mortgages with low "teaser" rates lured the rich as well as the not-so-rich, many of whom bought second homes (and sometimes even more) with the intent to quickly resell, or "flip," them at a profit.
When the housing market collapsed, they could find no buyer, leaving them strapped with debt, falling prices and little hope of refinancing.
"We know of a lot of folks who own more properties now than they ever thought they'd still have," said Dan Moisand, a certified financial planner in Maitland and former chairman of the Financial Planners Association of America. "There are many stories out there about flippers who are stuck all over the place."
Thursday, January 10, 2008
Rough times ahead.
by Atrios at 10:36