Foreclosure Numbers Soar
Foreclosures are up here in North Carolina and more than 1 million homes nationwide are expected to fall into foreclosure this year. 528,000 homes fell in the first 6 months of 2010. According to RealtyTrac Inc, 2010 is expected to top the 900,000 homes repossessed in 2009. To give you an idea of the enormity of these numbers, historically, about 100,000 homes per year foreclose.
Banks are letting delinquent borrowers stay in their homes longer now than in the past rather than adding even more foreclosures to their already bursting inventory. However, this only delays the inevitable. Many who are behind on their mortgages are temporarily enjoying living in their homes for free while saving for their next residence. The foreclosure will be a huge detriment to their credit history and chances are they won’t be able to buy again for 5-7 years but, for now, they have the opportunity to take advantage of the banks being overwhelmed with inventory.
Between January and June of this year alone, about 1.7 million homeowners, or one in every 78 U.S. homes, received a foreclosure-related warning. There are more than 7.3 million home loans in some stage of delinquency.
Currently, it’s taking about 15 months for a home loan to go from being 30 days late to the property being foreclosed and sold and it is estimated that it will take until 2013 to unload all the properties that the banks currently hold. Adding all the foreclosures to the weak economy and with unemployment still strong, it is predicted that house prices will continue to fall for at least the next 1-2 years.
Unemployment or reduced income continue to be the main catalysts for foreclosures this year. At the beginning of this housing crisis, poor lending standards were the culprit. Now, homeowners with good credit who qualified for and received conventional, fixed-rate loans are the fastest growing group of foreclosures.
Nevada posted the highest foreclosure rate in the first half of the year. One in every 17 households there received a foreclosure notice.
Are you at risk? Do you know what you’re going to do? Can you just walk away? At the very least, know the foreclosure laws in your state.
This phenomena greatly impacts all of us, even those of us who aren’t in risk of foreclosure. The glut of discounted homes on the market lowers everyone’s property values and ability to sell and the financial drain on the overall economy is huge. What can we do about it? What are you doing to protect your economy?
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