In retrospect, Ellie says she should have read the fine print.

Almost a year ago, Ellie (not her real name) and her husband took out a $250,000 mortgage on their condo after succumbing to a mortgage company's offer of a 2 percent initial interest rate. Their initial monthly payments, it turned out, were less than the average rent for a two-bedroom apartment.

But after a short introductory term, their interest rate began climbing and their payments shot from less than $1,300 to about $2,100. To make matters worse, Ellie and her husband are no longer able to pay the full interest and principal on their loan. As a result, thousands of dollars in deferred interest have been tacked on to the principal amount they owe.

"We're trying to sell, but we had to cut the price because it wasn't moving," said Ellie, who is praying for a buyer so that they can get out of their mortgage. "If it doesn't, I don't know what we're going to do."

Gullible or desperate homeowners who fell for high-risk, low-interest mortgage deals over the past few years are clogging foreclosure lists and bankruptcy courts as a slowing real estate market makes it more difficult for property owners to get out of financial trouble by selling. In Massachusetts, foreclosure filings by banks and finance companies have nearly doubled in the past year, with an 87 percent increase in Bristol County, alone.

"People who fell for seemingly cheap, adjustable rate mortgages probably account for about 50 percent of the people we see in trouble out there," said Mary Ellen Rochette of Pro-Home Inc., which provides homebuyer and foreclosure counseling to consumers in the Attleboro-Taunton area.

"In a lot of cases the last few years, people were so desperate to get into a home, they got in way over their heads."

Although Massachusetts home sales have begun to pick up lately, the modest resurgence hasn't been enough to rescue many of those who were counting on price appreciation to bail them out.

The crisis has come into sharper focus with the failure of New Century Financial, which filed for Chapter 11 bankruptcy protection last week.

New Century was one of a number of troubled lenders whose specialty was dealing with buyers who have less-than-ideal credit or who otherwise fail to meet the qualifications of prime mortgage lenders.

The resulting restructuring of New Century led to the closure of its Foxboro office, where 47 people were thrown out of work.

Escalating problems in the so-called "subprime" and "alternate" mortgage markets have led to speculation that financial difficulties might bleed over into more conventional forms of financing.

Already, some real estate dealers say they are finding banks and mortgage companies getting picker about credit risks.

"We've had a few people who were walking around with pre-qualifications find out those loans are no longer available," said Agnes Fountas of Agnes Fountas Real Estate in Attleboro. "Lenders seem to be tightening up." If banks and other mortgage lenders become reluctant to grant loans to all but blue-chip borrowers, some experts have speculated it could have a long-term impact on prices and the ability to sell property as the pool of potential buyers becomes shallower.

But many in the banking and real estate industry are skeptical that a meltdown in the general mortgage market is in the cards.

"To say that banks are tightening up on mortgages is a blanket statement," says E. Dennis Kelly, president of Bristol County Savings Bank. "I don't think we've changed anything in our underwriting of loans."

Joseph Valentine of the American Bankers Association said he sees no signs of a credit crunch for homebuyers.

"There's no evidence that what's been going on in the subprime lending market is having any effect on other types of loans," he said.

However, it's possible that potential buyers might find less access to subprime loans, as some companies in that category either go out of business or cut back on the number of new mortgages.

Doug Azarian, president of the Massachusetts Association of Realtors, said subprime mortgages account for an estimated 15 percent of the overall market, and that as few as 3 percent can be considered troubled loans. And only a fraction of those, he said, ultimately result in foreclosure.

With a rare let-up in price increases, conditions in the real estate market might actually favor buyers for the near future, Azarian said.

"Historically, mortgage interest rates are still very low," Azarian said, "and that makes it a good to buy."

RICK FOSTER can be reached at 508-236-0360 or at rfoster@thesunchronicle.com.