Foreclosures in Upper Middle Class Areas

August 18th, 2008

foreclosures in middle class areas

The problem of foreclosures has also been hitting the middle and upper middle class families. This is affecting people from all income groups and professions. The scenario is worsening day by day. The slow pace of US economy together with the tight mortgage terms and conditions are responsible for it. Hampton Township is one of the well to do areas with a large number of upper middle class families living there. It has been observed that about 30 homes have been foreclosed in 2007. About 7 years ago, only two homes were foreclosed. It can be seen that the upper middle class families are also not left out from the problem of foreclosures besides the working class. The real estate is heavily suffering for that.

Dan Murrer of RealSTATs has prepared a report on the foreclosure filing in about 32 well-off neighborhoods and towns. He has said, “It’s hitting people of all professions and backgrounds,” According to his findings, there has been a 210 percent increase in foreclosures. From 180 foreclosures in 2000, it has increased to 558 in 2007. This is indeed a huge increase. This reveals that this problem of real estate is increasing beyond sub-prime loans in low income places.

Mt. Lebanon has recorded a jump from 10 to 25 foreclosures while in Bethel Park, the number of foreclosures have increased from 12 to 38. In the year 2007, the number of foreclosures in Ross was 38. This is in fact a big increase from what it was in 2000. The number of foreclosures then was only 5. The other areas that are facing the brunt of foreclosures are Plum Boro in the east and Moon Township in the west. There has been an increase in foreclosures from 12 to 35 in Plum Boro and 8 to 27 in Moon Township.

Murrer has said, “The fact that foreclosures are increasing in these middle-class neighborhoods is indicating that the ‘average Joe’ with a standard mortgage is the one who’s getting foreclosed on,” According to Ray Dietz of Allstate Financial, it is the greed of both the buyers and lenders that have led to the increasing rate of foreclosures today. In a bid to buy a larger home the buyers did not submit the proof of income to get the mortgage and at the same time the lender did not ask for it. However, others who once were able to afford their mortgage are also facing the danger of losing their home due to high living cost or due to loss of their job.