Nationwide Foreclosure Filings Still Increasing
According to RealtyTrac’s latest report on the mortgage industry, the rate of foreclosure loans has not declined nationwide and has increased in those states where investors did most of their speculation by buying-up homes and condominiums. In three of these states, California, Florida and Ohio, foreclosure rates are 100% higher than they were last month.
RealtyTrac also stated that foreclosures rose last month in 77 out of 100 major US markets, and those cities in California, Florida and Ohio made up two-thirds of the top-twenty five metro foreclosure rates. In the small city of Stockton, California, one out of every 31 households had a mortgage foreclosure making that city the highest level of home foreclosures of all in the top 100 metro list. Detroit, Michigan came in second with one out of 33 foreclosed and San Bernardino, California was third with one in every 43 in foreclosure. Other cities that made the top 100 foreclosure list included Las Vegas, Nevada, Fort Lauderdale, Florida, Oakland, California and Bakersfield, California.
All of this has prompted the National Association of Realtors to report that the many foreclosures on the market are likely to improve overall homes sales figures by early next year. NAR’s chief economist said that while the level of demand reaching the market is still uncertain, even higher homes sales than expected is possible if buyers gain a renewed confidence in the benefits of owning a home. He feels that the figures will remain rather flat due to the impact of the recent foreclosure crisis and declining values, but that things may well change early next year.
In the meantime, both the Federal Housing Administration (FHA) and Fannie Mae said they are now taking steps to do something positive about the foreclosure rates and mortgage crunch, but that they are also challenged to make any changes quick and meaningful. Fannie Mae is currently renegotiating sub prime housing loans at a rate of about 750 each week. They also predict that nationwide home prices will continue to decline through 2008, and is seeking legislative approval to finance higher-priced mortgage loans in the future.
The FHA, that provides government-backed insurance for home loans is currently seeking the government’s okay to modernize its operations and provide more home loan financing. While they have already expanded their refinance business to help borrowers having problems with sub prime loans, more help is needed. The FHA projects that they will serve about 80,000 delinquent borrowers in 2007.
FHA’s Commissioner asked Congress to approve changes at the FHA as quickly as possible and told them that the FHA has both the necessary products and services to help hundreds of thousands homeowners with moderate-incomes. And while it seems likely that Congress will approve the request, the wheels of politics always seem to move slowly when the need is extreme. It is unfortunate that when our government does take positive steps, it will be far too late for the many homeowners who have already been made homeless through sub prime foreclosures.
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People bought more house than they could actually afford, I think. Now the chips will fall where they may.