You might call it a hut.

Thomas and Ruta Vicker call it home. (more…)

A South Florida family will soon be moving into a new $195,000 two-bedroom condominium at Aaron Arms in Miami Gardens.

But thanks to about $100,000 in Florida mortgage subsidies, the Melgars will only need to make payments on about half the purchase price. (more…)

Struggling to make Florida mortgage payments on time? Aren’t we all. Now, however, you can at least earn some extra perks for your troubles. (more…)

Florida mortgage woes, higher gas prices and a “perfect storm” of other financial troubles have caused personal bankruptcies to spike in Central Florida so far this year, according to the Orlando Sentinel.

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Is it any wonder that 1,168 Broward County homeowners have endured submitting late Florida mortgage payments?

(more…)

It seems like an easy call, but some experts’ guidance regarding this age-old financial question may surprise you.

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The number of South Florida mortgage holders facing foreclosure has spiked in 2007, but many people behind on their house payments are resolving their debts before losing the properties, new figures from Realestat.com show.

Although homeowners are avoiding having lenders take their homes, they’re burdened by the region’s soaring housing costs, experts say.

“There’s still a risk of a major increase in people losing their homes,” said Marc Thomashaw, a Realestat.com vice president. The housing squeeze is going to get worse before improving, he added.

Escalating home values from 2000 to 2005 caused buyers to overextend themselves. Many took out short-term, adjustable-rate Florida home loans and are seeing their monthly payments balloon as interest rates rise. Increases in property taxes and insurance rates also are making it difficult to pay the monthly mortgage.

“These are not bad people,” said Louis Spagnuolo, a senior mortgage banker for Home 123 in Boca Raton. “But a lot of them are on fixed salaries, and they can sustain only so many price increases.”

The Mortgage Bankers Association on Tuesday said late mortgage payments nationwide shot up to a 3/1/2-year high in the fourth quarter of last year, while new foreclosures surged to a record high as borrowers with weak credit had trouble keeping up with their monthly bills.

The number of late payments in the Broward County housing market hit 983 in February, a 333 percent increase over the 227 last February, according to Realestat.com, a Plantation-based company that compiles local housing statistics. But Broward had only 315 foreclosures last month, compared with 206 in February 2006.

Last month, the Palm Beach housing market had 733 property owners with late payments, up 382 percent over the 152 last February. But the foreclosures increased at a more modest clip: 141 in February, compared with 115 a year ago.

Both counties saw similar trends emerge in January.

People facing foreclosure typically are behind on their Florida mortgage loan payments at least 90 days and have been notified by their lenders that they intend to take back the properties, experts say. Many of those homeowners are refinancing the loans or cutting other deals with lenders to keep their homes.

Honey Hartman, 67, of Hollywood is facing a mortgage crunch. A huge property tax increase this year pushed her monthly mortgage payment to $770, which exceeds her income of $643.

She negotiated with her lender to cut some of the added costs, and her two grown children are helping her make up the rest of the shortfall. Hartman expects she’ll ultimately have to sell her two-bedroom home and leave South Florida. “I’m in dire straights,” she said.

Overdue Florida mortgage payments continued to soar over the final three months of 2006, and soared over first fiscal quarter of 2007, the Palm Beach Post reported Tuesday.

The late payments invariably lead to foreclosures, which in Florida set a new record as borrowers with troubled credit fell behind in their payments.

The picture of an ailing Florida housing market - and of shaky borrowers standing on their last legs - was equally dismal as the Mortgage Bankers Association released its quarterly snapshot of state mortgage markets.

New foreclosures jumped to a record high of 0.54 percent. The previous high was 0.50 percent in the second quarter of 2002 as the U.S. economy tried to recover from the 2001 recession, the MBA said.

The survey of 43.5 million first mortgage loans nationally - about 80 percent of all outstanding home loans - drove yet another nail into the coffin of the five-year housing boom and ended any doubt the boom has gone bust.

A once-sizzling housing market in the Sunshine State has given way in recent months to some of the highest foreclosure rates in the nation, leaving Florida mortgage holders in a world of trouble from the Panhandle to ther Keys.

Florida mortgages overdue for 30 days or more in the fourth quarter of 2006 climbed to a record 4.86 percent of all loans tracked - up sharply from the same period in the previous year, when 4.66 percent were delinquent.

“As Florida was rocketing up in values, we had lots of investors that bought homes with the expectation of flipping these homes,” said Jim Sahnger, vice president of Palm Beach Financial Network in Sewall’s Point.

“Many of these people are now over-leveraged or they’re ‘upside down’ - they owe more than their house is now worth.”

The bleak report comes on the eve of the traditional spring home-selling season. Surging Florida home loan defaults and foreclosures could dump as many as 500,000 more properties onto the already bloated inventory of unsold homes, analysts say.

The report echoes a widely discussed report from Lehman Brothers Holdings this week that warned mortgage defaults could rise to $300 billion this year if home prices plunge, and tightened lending standards prevent homeowners threatened with foreclosure from Florida mortgage refinancing.

In Florida, past-due mortgages led inexorably to record new foreclosure filings in the fourth quarter of last year. The percentage of Florida home loans for which foreclosure began more than doubled from the same period in 2005, rising 24 basis points to 0.45 percent from 0.21 percent.

By loan type, subprime mortgages - bad credit Florida mortgage loans for people with no credit history or bad blots on their credit background - performed much worse than prime mortgages, as expected.

During the past five years, subprime loans have more than doubled in share, amounting to nearly 20 percent of all loans in 2006.

The delinquency rate for subprime loans in Florida in the fourth quarter was 12.53 percent, up 139 basis points from the fourth quarter of 2005, the survey showed. The default rate for prime loans in Florida was only 2.69 percent, up from 2.62 percent in fourth quarter 2005.

Those with a Florida mortgage often wish to be done with it as soon as possible. They want to be full-fledged homeowners.

Below, financial analyst Don Taylor responds to the implications of just such a scenario:

Q: How would prepaying my mortgage affect my taxes? I’ve read several articles in reference to “prepaying mortgage” not being a good idea. My dream is to be mortgage free and own my home outright. Is this a nightmare instead of a dream?

A: If you use the mortgage interest deduction on your income taxes, then prepaying your mortgage reduces your interest expense, and by doing so, that interest deduction. IRS Publication 936, Home Mortgage Interest Deduction, has everything you need to know about that deduction.

Not everyone who owns a home can use the Florida mortgage loan interest deduction, and where the mortgage interest expense doesn’t do much more than replace the standard deduction, prepaying the mortgage only has a marginal impact on their taxes - the margin being the difference between itemized deductions and the standard deduction.

Read more about what the tax benefits of home ownership are today.

Your goal to be mortgage-free isn’t a nightmare. Keep the dream. I think that it’s a great goal for homeowners to have the house paid off before they retire. What I counsel is to not abandon other financial goals, such as retirement savings, to focus solely on paying off the house.

My rule of thumb is, if you expect to earn more on your other investments, on an after-tax basis, than the effective (after-tax) rate on your mortgage, then don’t prepay your mortgage.

For example, if you’re skipping out on contributing to a 401(k) plan and missing the company match, you should be contributing to the 401(k) up to the limit of the company match before making any additional principal payments on your mortgage.

Late payments for residential national and Florida mortgages shot up by 15.6 percent in the fourth quarter, U.S. regulators said last week in a report showing record earnings by commercial banks and thrifts in 2006.

The Federal Deposit Insurance Corporation, which insures deposits at more than 8,600 banks and savings institutions, said the increase in late mortgage payments followed a 5.2 percent increase in the third quarter.

Noncurrent mortgage loans - payments that are more than 90 days late - grew by $3.1 billion in the last three months of 2006 after rising by $974 million in the third quarter, the FDIC said.

Richard Brown, FDIC’s chief economist, said regulators are seeing emerging signs of distress among subprime loans, especially with hybrid home loans that subject borrowers to higher monthly payments after introductory interest rates.

“While the degree of credit distress in these portfolios is still well below the peaks that we saw during and after the 2001 recession, it seems likely that their performance will get worse before it gets better,” Brown said.

Bank regulators are considering new rules on popular loans for subprime borrowers with less-than-stellar credit that carry low introductory rates but can rise over the life of the loans.

Consumer advocates have warned that loose underwriting standards will soon have homeowners buried under mortgage debt.

Brown said that total subprime Florida home loans outstanding amount to about $1.3 trillion, of which $700 billion are held by private asset-backed securities issuers.

That means banks, thrifts and other mortgage lenders are holding about $500 million in subprime mortgages, Brown said.

Financial institutions insured by the FDIC held about $2.2 trillion of mortgages for single to multifamily homes at the end of 2006.

“We know for certain that more than three quarters of the mortgages held by all FDIC-insured institutions are prime loans,” Brown said. “The actual percentage is certainly higher - perhaps as high as 85-90 percent.”

For the fourth-quarter FDIC-insured commercial banks and savings institutions posted net income of $35.7 billion, 9.3 percent higher than the fourth quarter of 2005, but lower than $38.1 billion earned in the third quarter.

The FDIC said the industry’s performance in the last three months of 2006 was stronger than the numbers indicate because restructurings at a few large institutions resulted in understated income and expense items.

“The banking industry continues to perform well,” FDIC Chairman Sheila Bair said in a statement, “even as an inverted yield curve and weakening mortgage market have made the operating environment more challenging.”