Increase in US Foreclosures Continues Unabated

August 4th, 2008

There has been a marked 121 percent increase in the nationwide real estate foreclosures from the second quarter of the last year. It has almost doubled. The tight lending standard, soft housing sales, dropping US economy together with declining home value has been instrumental in making the situation worse for homeowners. Many have failed to refinance into an affordable loan and many are unable to get prospective buyers. It has been reported by Irvine, Calif.-based RealtyTrac Inc. that about 739,714 homes throughout the nation received one foreclosure notice during the quarter. Or it can be put this way that one in every 171 US households received a foreclosure notice.

The foreclosure rates have been the highest in Florida, California, Nevada, and Alaska during the quarter. Among them, Nevada accounts for one foreclosure filing for every 43 households. North Dakota and Alaska has faced a continual increase in real estate foreclosures. Besides, Florida and California cities have reported 16 of the 20 worst metro foreclosure rates. The situation in Stockton, California, is that the foreclosure rate is nearly seven times as compared to the national average. It has reported about one foreclosure filing per 25 households. The chief economist at Moody’s Economy.com named Mark Zandi figures that about 2.8 million households in US by the next year end will be either facing foreclosures, or sell their home at a price lower than the value of mortgage, or place it into the lender’s hands.

According to RealtyTrac, which keeps a track of auction sale notices, default notices, and bank repossessions, over 222,000 properties in the second quarter across the nation were taken over by banks. This made for 30 percent of total foreclosures that means a hike of 24 percent from the last quarter. A housing rescue bill has been prepared by the Senate to keep away 400,000 homeowners from real estate foreclosures. It has also been designed to provide support to Fannie Mae and Freddie Mac, the two troubled mortgage finance companies.

The chairman of the House Financial Services Committee named Rep. Barney Frank, D-Mass. has ordered to have a thorough regulation of the loan servicing companies if they do not make modifications to keep away foreclosures. It has been reported by the Congress that a large number of homeowners have complained about not getting help from their lenders to keep away foreclosures. According to James Barber of the American Bankers Association, they try their level best to avoid real estate foreclosures.

One can only hope for better news in the future!