Mortgage stress for sub-prime lender’s customers
More than fifteen per cent of home loan customers of the sub-prime lenders such as Adelaide Bank, Challenger Financial, Liberty Financial and Bluestone remain in arrears on their mortgage. Standard & Poor's said 17.8 per cent of Bluestone's sub-prime loans are in arrears, 18.5 per cent for Challenger and 18.3 per cent for Liberty. Once a borrower slips more than 90 days behind on their mortgage the rate of recovery is very poor said Standard & Poor's, who warned that sub-prime lenders face difficult times on 2009 as unemployment rises and arrears may increase. Refinancing can be extremely difficult for a borrower who is more than 3 months overdue on repayments.
Source: Sydney Morning Herald