Interest Builds In Interest-OnlyMortgages
WASHINGTON - (06/06/05) -- Interest-only mortgages, only a blipin the market as recently as two years ago, have soared to a 21%share of the mortgage market, as homebuyers seek to take advantageof rising home values. Data compiled by National Mortgage News,sister publication of The Credit Union Journal, shows thathomebuyers took out more than $141 billion in IO loans in the firstquarter, compared to $661 billion in all home loans. Lenders areaggressively marketing IOs, which offer low initial payments, minusprinciple. Many lenders weren't even making IO loans a year ago.But the biggest mortgage lenders are wracking up huge IOportfolios: Countrywide Home Loans made $13.7 billion worth in thefirst quarter; Wells Fargo Home Mortgage made $9 billion; AuroraLoan Services, a unit of Lehman Brothers, made $8.7billion.