After some ups and downs, Iowa's foreclosure rate is on the upswing again. According to an article in the Friday August 27th 2010 Des Moines RegisterIowa's foreclosure rate rose to 2.82% of all mortgages in the second quarter of the year. The figures provided were gleaned from a Mortgage Bankers Association report.
The news sort of crushed the optimism fostered by the first quarter report which showed that delinquencies fell from 2.79% of all mortgages in the fourth quarter of 2009 to 2.77% in the first quarter of 2010. The marginal drop was highly touted as proof of a trend reversal, but I for one had my doubts due to the increasing unemployment rate, number of business closings in rural markets and lack of stability in home prices. With home prices not stabilizing upside down sellers can find it hard to refi or resell.
A local representative of a community group interviewed for the article mentioned the failure of HAMP as a contributing factor to the increase in foreclosures. The high fall out rate for participants in HAMP was the focus of many news reports last week.
Just to show knee jerk optimism is alive and well however, Dan Vessely of Iowa Bankers Association thinks "maybe, just maybe we have bottomed out" in response to another statistic in the report that showed Iowans 30 days or more late on their mortgage payments fell to 6.3% of all loans from 6.34% a year earlier. A .04% improvement in delinquencies, that's a four hundredth of a percent change, is not enough to signal anything, much less a market bottom. Doubly so since the delinquency rate here in Iowa does not take into account loans in the process of foreclosure, which "in Iowa tends to be extended because of homeowner protections."
Also quoted in the article was Jake Stanton CEO of Prudential First Realty in Des Moines. I've met and spoke with Jake on several occasions and we're friends on Facebook. I know him to be a very honest, intelligent and incisive person. Jake stated he expected foreclosures to remain a problem for the next 24 months and that "we're not seeing a significant slowdown in what's in the pipeline." Between Jake and Dan's assessment, I'd "bank" on Jake's comments being the more perceptive of the two.
For those that would like to see what kind of foreclosed properties are available in the Des Moines area, I send out a daily free foreclosures list daily from Monday through Friday. To sign up follow this link: http://dailyfreeforeclosureslist.myiowahome.com
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