US: Stressed borrowers use plastic to delay default

[Green_Bear]

CHICAGO (Reuters) - This may be Johari Reeves’ last chance to catch up on her mortgage payments. The credit cards, she’ll worry about later.

“We fell behind (with the mortgage) and twice we agreed to new repayment schedules that didn’t work out,” said the 31-year-old, a compliance officer at a small bank on Chicago’s blue-collar South Side. “It’s been a lot of stress. But this time, if all goes well, we should be able catch up.”

In August 2006, Reeves and her husband bought a $214,000 home with almost no money down, leaving them with a monthly payment of $1,636 – higher than they planned on, especially with her husband’s furniture sales job largely commission-based and business not good due to the U.S. housing slowdown. >>>>

Stressed borrowers use plastic to delay default
news.yahoo.com/s/nm/20071028/us_ … ds_debt_dc

NEW YORK - With the subprime mortgage and home equity markets souring in recent months, bonds backed by pools of credit card debt continued to be the most popular type of securities issued in recent weeks.

Through Oct. 26, bonds backed by pools of credit card debt totaled $14.33 billion for the month, according to JPMorgan Chase & Co. research. It is only the second month this year credit-card backed securities volume exceeded $10 billion.
Credit-card backed securities accounted for 45 percent of total October asset-backed securities _ bonds backed by varying assets such as credit card debt, home loans and auto loans _ and have been the most popular type of asset-backed securities over the past four months.
Bonds backed by subprime mortgages and home equity loans have fallen out of favor with investors, as the mortgages have gone increasingly delinquent and into default in recent months. >>>

Credit Card Bond Volume Tops $14 Billion
forbes.com/feeds/ap/2007/10/ … 73174.html

Jumping from the frying pan into the fire comes to mind