Mortgage Moms Feel the Heat

Back in the Nineties it was the Soccer Moms who voted for Bill Clinton. Then after 9/11 it was the Security Moms who voted for President Bush.

Now, according to Jeffrey H. Birnbaum and Chris Cillizza in the Washington Post, it’s the Mortgage Moms, people who are up their eyeballs in debt.

Flat wages and rising debt nationally have converged to leave millions of middle-class households feeling acutely vulnerable to bumps in their financial planning.

Debt. The numbers are huge.

The amount of mortgage debt alone has more than doubled since 2000, to nearly $9 trillion.
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Among the most exposed are those who bought into one of the great fads in mortgage lending in recent years -- adjustable rates. Next year, $1 trillion worth of adjustable-rate mortgages -- about 11 percent of all outstanding mortgage debt -- is scheduled to readjust to a higher interest rate for the first time, according to LoanPerformance, a research company.

Right now we are at the stage in the business cycle where people are still talking about a “soft landing.” Humans are, by their nature, hopeful.

But that puff of smoke you see when an airplane lands at your local international airport is a reminder that on any landing, soft or hard, someone gets burned.

And the Mortage Moms, who are getting burned by the ratcheting adjustable mortgage rates, are not likely to be voting for the party in power this fall.