A few weeks ago we asked you to tell us what you were seeing out there; stories about the effects of the subprime debacle and the credit crunch on those who are on the ground and feeling the real impact. If you are a delinquent borrower, what have been your experiences in trying to work with your lender? What impact has tightened credit had on pending house sales? What is behind the massive cancellations of home sale contracts reported by new home builders?

We heard from you loud and clear.

We have had dozens of responses from consumers, mortgage brokers, former lenders, real estate agents, and investors. Some people wrote one line, others submitted virtual essays.



The replies we received ranged from well reasoned and analytical to extremely emotional. In the latter group words gushed out without regard to grammar or spelling and in many cases will require a lot of translation; you can almost see the tears on the "paper."

Consumers admit that they stretched to buy their homes or that perhaps they were not as careful as they should have been in vetting the companies they were borrowing from or the individuals who were charged with placing their loans. Some of the people writing were begging for help, others have simply given up but wanted someone to hear their story. Most sad are those people who have lost or are about to lose their homes yet still have no idea what hit them.

So far the responses have broken down into several categories:

Reports from debtors who are trying to resolve individual problems with mortgage companies;

Stories about victimization from predatory lending;

Anecdotes from investors and real estate agents who are trying to work with lenders on short sales and/or purchasing owned real estate;

One thing we did not expect but which dominated much of the correspondence is the lack of understanding of the home buying and/or lending processes that still exists. Even people with experience in real estate or lending seemed to have closed their eyes and walked into a wall when buying their own homes.

A lot of letters that sort of fell into the above category were from people who did understand the risks inherent in what they were doing but they deluded themselves into believing the boom would last longer or that their rates wouldn't jump so much.

There was also a lot of finger-pointing. Consumers blaming real estate agents for selling them too much house; mortgage brokers accusing lenders of pushing aggressive sales techniques; everybody seems to have a favorite villain.

It is also instructive to hear how quickly and often over what small problems people got into serious trouble. There has long been an adage that says most people are only five (or four or seven - pick a number) paychecks away from being homeless. The letters we received showed just how thin the margin is for too many.

One question we asked which has not received much response is from the servicing side; how collectors, loss mitigation specialists, and foreclosure attorneys are coping with the increase in delinquencies and foreclosures. We would love to know from their perspective whether mortgage servicers are heeding the advice of Freddie Mac, Fannie Mae, and the federal government to work with homeowners or if, as we are hearing from those homeowners, they are unyielding and inflexible in workout discussions.

We cannot possibly publish each and every one letter we received, at least not in full, but we will approach the backed-up mailbox and deal with each of the rough categories we have outlined above. We know that our readers frequently respond to our stories months - even years - after they are originally written so we hope to keep this as a running dialogue as long as the subprime situation and the resulting fallout continues. We look forward to hearing from you and we especially hope that what we hear a few months from now will be more hopeful than what we are hearing today.