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Foreclosers on the Rise
By Vic Hurlstorm | July 16, 2009
Foreclosed news continues to dominate national headlines as the unemployement rate keeps climbing. The first quarter of 2009 reported that nearly 6% of borrowers are already behind on their mortgage payments or are in the brink of foreclosure. In comparison to a year ago, this number has doubled. According to the Mortgage Bankers Association, it is very alarming to see that the rate of troubled homeowners have doubled in the past year.
In April, 342,000 properties in the US were foreclosed. Of these, 96,500 of them were in California alone. This data is according to a web-based company, RealtyTrac. Reportedly more than 600,000 senior citizens are also either delinquent or have already been foreclosed on. AARP reports that older Americans, the ones that have subprime first mortgages, are 17 times more likely to have their homes foreclosed than Americans, of the same age, having prime loans.
The community is dramatically impacted by subprime loans and their much increased rate of foreclosure. A study showed that in areas where subprime loans are prevalent, the number of foreclosure filings is also high. The foreclosure news seems to dominate the airways and subprime loans account for nearly 50 percent of those cases.
Other factors affecting foreclosures in a localized area were also studied. They considered home value, race and income but arrived at a conclusion that subprime lending is the major factor for foreclosures. Not surprisingly, one factor that did repeatedly impact the rate of foreclosure was unemployment. People don’t have enough income to keep up with their mortgage. That’s why MS Foreclosure and other areas as well are skyrocketing. Because of this, the Federal Reserve Bank of Boston recommended that unemployed homeowners should be given more focus by policies that aim to fight foreclosures.
Many more Americans are still at risk of having their properties foreclosed. (Note: When doing your research online make sure to search for ‘forecloser‘ as well as it is a very common miss-spelling.) But the government has already issued several legislations and policies to minimize the situation. And the progress of these programs is still nowhere to be found because it takes more time than unexpected. Until these plans have proven to be effective, we may have to brace ourselves for more foreclosure news to come in the future.
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