Home forclosures have affected many homeowners.  Many of these homeowners bought thier home with ARMS’s or adjustable rate mortgages.  I guess in some cases some people feel like they gave their arm to get a mortgage.  Anyways, as their interest rate rises, they can no longer afford the house payment.  So they stop making payments and are forced to move out of thier home.

At least it is thier home that they are moving out of.  What is happening now is that renters are living in homes owned by investors.  These investors bought these homes solely as a business decesion.  They thought they could buy low and sell high.  And with the ability to buy a rental property with a low rate was very appealing.  It kept the payments low, so the rent could cover the payment.  And by the time the rate adjusted, they would have sold the home and made lots of money.

So now the interest rate has gone up.  The investors are no longer able to make the mortgage payment, and also are not able to sell the home.  So the investor lets the home go into forclosure.  This will hurt the investor, but it also hurts the tenant living in the home.  The mortgage company will force out the tenant.  If the landlord dosen’t make the payment, the tenant must move.  These types of forclosures are increasing, so the tenants looking for different housing is also increasing.  Tenants are finding it harder and harder to find a place to live.