November 27, 2007 (LPAC)--On Nov. 15, Sen. Charles Schumer (D-NY) issued a report estimating that 50,000 subprime mortgage borrowers in New York may have actually been eligible for prime mortgages "meaning that they may have been duped by brokers and lenders into taking less affordable loans."

The estimate of 50,000 is based on "recent estimates" by industry experts that one-third of all subprime borrowers may have been eligible for traditional mortgage options "thereby avoiding the excessively high subprime interest rates, as well as the hassles of refinancing when the loan becomes unaffordable." It has been reported to earlier Congressional hearings, by lawyers familiar with the practice, that mortgage brokers being paid by homeowners to find them mortgages, in many cases were also being paid a fee by mortgage lenders, typically $2,000 for each additional (unnecessary) percentage point of interest they could add to the mortgage loan. "Subprime" was the convenient way to designate "high-interest."

There are over 160,000 subprime mortages in New York with an estimated outstanding debt of $26 billion.