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As the national housing crisis continues, Missouri is now among the top states with mortgage problems. On Thursday, the Missouri Credit Union Association met with local credit unions and lawmakers at Bass Pro Shops in Springfield. KSMU's Benjamin Fry was at the meeting and files this report.
Rows of empty, unsold houses is a scene that's becoming more common in cities and suburbs of the Show-Me State.
The Missouri Credit Union Association, or MCUA, is hoping to reverse the effects of the subprime-mortage crisis.
Nancy Pierce of the Tipton Research Group co-authored a study looking at mortgage activity across Missouri.
She says the housing crisis is affecting more people now as a result of combined economic woes.
Pierce says Missouri is now ranked fifth in the nation in delinquent mortgage payment.
Over the course of last year, its foreclosure rate had shot up by over 90 percent.
The counties that have the highest in home foreclosure include Camden, Douglas, and St. Louis Counties.
Foreclosure is more acute in urban areas, where Pierce says one devalued home can affect up to 45 neighboring homes.
A big factor leading to foreclosure is subprime lending.
This is when lenders provide loans at a higher rate than the prime rate.
Subprime lending is a common option for people with bad credit or bankruptcies.
Some of these lenders take advantage of the borrower by giving loans based only on the foreclosure value, or other fraudulent practices.
Some state governments have become involved with lending practices, but Missouri legislators have been hesitant to do so. Republican Representative Charlie Denison of Springfield feels this is an issue that should remain between homeowners and their lenders.
Lawmakers and creditors agreed that one way to alleviate the problem is better communication between creditor and customer.
Judy Hadsall is the CEO of the CU Community Credit Union in Springfield.
She says people with bad credit may resort to subprime loans because they are hesitant to talk to their credit unions.
Other solutions discussed were for credit unions to inform the public on how to avoid foreclosure and for customers to be wary of aggressive refinance offers.
For KSMU news, I'm Benjamin Fry.