Foreclosures Maintaining a Low Profile This Season (Part II)

The Hope Now report shows that Florida’s records as compared to the first quarter’s 23,463 have increased. In the months of July and August, there were, another 31,683 that were finalized. This transcends this rate to approximately 47,000 for the whole quarter. However, there is a slow down in the modifications involving reductions in interest or principal or even an extension in the longevity of the loan. In the second quarter, there were 23,285 such modifications. Compared to the first quarter’s 28,670 the fresh figures were quite less.

In the months of July and August, there were merely 9,118 mortgages, that went through modification. Going by that rate within the full quarter, very less than 14,000 will go for modification. An increasing number of short sales are not the prime reason for the fall in the number of foreclosure filings. Short sales took place as lenders sold the properties for fewer amounts than what they were to be paid. In the month of June, the number of short sales reached 163 as per the Brevard Multiple Listing Service. They have continued to fall since then on a monthly basis and in the month of October the number of short sales reached 124 in number.

Partly the overloading of the lenders with the increasing number of foreclosures might be responsible for this fall in the number of filings. As the filings have slowed down, the number of cases leading to foreclosures have however, not reduced in the process. The third quarter saw the state going through at least 19,000 foreclosures and in the second quarter, there were around 18,000 foreclosures. In Olefson’s words, “We are going to see more foreclosures. There is no doubt about it.” However, for most of the homeowners who have to face foreclosures, it might not mean displacement on an immediate basis. They may not have to leave as soon as the process of foreclosure is over.

According to a ‘Deed for Lease’ program by Fannie Mae, the struggling homeowners will now be able to pay their rent and at the same time stay in their houses for approximately a year’s time and so they do not have to surrender their properties to the lenders on defaulting with repayments. Jay Ryan, the Vice President of Fannie Mae observed that, “This new program helps eliminate some of the uncertainty of foreclosure, keeps families and tenants in their homes during a transitional period, and helps to stabilize neighborhoods and communities.”

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