The blogosphere and financial periodicals have been all a twitter lately about the subprime meltdown, tightening of loan standards and skyrocketing rate of foreclosures.  Many who were able to get into a home over the last several years despite their less than perfect credit feel that because they got a mortgage already, that they have little to worry about with the current debacle.  Unfortunately, that may not be the case.

The concern I have is for those who financed using ARMs (adjustable rate mortgage) in the last few years to take advantage of a lower rate but are planning on refinancing to transition into a more long term loan once their ARMs unlock.

The headlines I’ve been reading are that the lenders are really tightening up their loan standards.  That means that if you go to refinance your loan and don’t have a significant amount of equity in the property already, its likely that you’ll have a more difficult time finding a lender who will loan to you if your initial loan was considered ’subprime’ (due to lack of documentation on income, poor credit, etc).