By Shane Goodman shane@dmcityview.com

You ain’t seen nothing yet

Foreclosure crisis so far is only the tip of the iceberg

Seventies rock band Bachman-Turner-Overdrive’s song could be the theme for the subprime mortgage crisis we are expected to see in 2008 in Iowa and across the nation. With the majority of adjustable rate mortgages set to adjust this next year, experts agree that the worst is yet to come. More than 4,000 Iowans have reached out for help with calls to a foreclosure hotline in efforts to avoid losing their homes. And Iowa Attorney General Tom Miller says those numbers are merely the tip of the iceberg.

We likely all know people who are being affected by this epidemic — Iowans of all ages, incomes and backgrounds. Many of us find it difficult to understand how these borrowers can enter into loan contracts without understanding the repayment terms. After all, this isn’t even the fine print. But with so many homeowners now affected, criticism is also being directed to unethical lending, which has been accused of setting up borrowers to fail.

Unfortunately, this crisis goes beyond the lender and the homebuyer. Now others, including neighboring property owners, are seeing decreases in their home values when foreclosures happen. Meanwhile, other industry insiders claim the statistics on foreclosures we read and hear about are not interpreted properly by the media, stating that things are not as bad as they appear.

Reporter Jason Hancock takes a look at the topic in this week’s cover story, interviewing local residents who are being impacted and those who are attempting to lessen the hardship. Brace yourself for more, as this certainly won’t be the last you will read on this subject. The aftermath will affect us all, in one way or another, for years.

Thanks for reading.

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