The fact is that many of these mortgages, people would never have been qualified for a $ 200 to 400K loan. These owners are too deep in water and even if you refinance to a rate of 2-3%, they will still not be able to keep their heads above water. Now that the bubble has burst, the loans are upside down. The only way to sufficiently reduce their payments and keep the house would be staggered over 40 or 50 years. Now, you are a debtor to a lifetime in your home. It actually used to be common to repay your mortgage and your own house before retirement.
No country can support other so-called “recovery” with a high rate of foreclosure. These statistics have been more consistent. This is surprising for those who have kept track of the details of what is being developed and what is the origin of borrowers entering foreclosure. The so-called “leadership” in the United States need to take his head out of sand!
As half million more workers lose their jobs each month it will not lead to repossession. Only Goldman Sachs and Chase, which were kept alive with the money of American workers of their dismissal before tax, profit from this depression. Now the Wall Street bankers are sitting fat and Main Street Americans who bailed are in dire straits and struggling to survive and remain in their own homes.
U.S. Foreclosure Filings Jump 23% to Record in Third Quarter
By Dan Levy
Oct. 15 (Bloomberg) — U.S. foreclosure filings climbed to a record in the third quarter as lenders seized more properties from delinquent borrowers, according to RealtyTrac Inc.
A total of 937,840 homes received a default or auction notice or were repossessed by banks, a 23 percent increase from a year earlier, the Irvine, California-based seller of default data said today in a report. One out of every 136 U.S. households received a filing, the highest quarterly rate in records dating to January 2005.
“The problem is prime loans going into foreclosure and people being underwater and losing their jobs,” Richard Green, director of the Lusk Center for Real Estate at the University of Southern California in Los Angeles, said in an interview. “It’s a really bad number.”
Mounting foreclosures mean U.S. home prices probably will resume falling, analysts from Amherst Securities Group LP in New York said Sept. 23. A “shadow inventory” of 7 million properties are in the foreclosure process or likely to be seized, up from 1.27 million in 2005, they said.
The pace of prime and so-called alt-A loan defaults is accelerating as subprime defaults slow, Standard & Poor’s analysts led by Diane Westerback said yesterday in a report. Prime loans are those made to borrowers with the best credit records while alt-A loans are considered riskier because they were often granted without documenting the borrower’s income.
More than $400 billion in U.S. home mortgages that were packaged into securities and sold by companies other than government-supported Fannie Mae and Freddie Mac are in default and may be foreclosed on, S&P said. Those defaults may depress home prices for years, the analysts said.
The delinquency rate for prime loans rose to 6.41 percent in the second quarter from 6.06 percent, the Washington-based Mortgage Bankers Association said Aug. 20. The share of prime loans in foreclosure increased to 3 percent from 2.49 percent, the MBA said.
“The number of people who can’t pay their mortgages, we haven’t seen the peak of that,” David Lowman, head of JPMorgan Chase & Co.’s mortgage unit, said this week. “That’s going to weigh on us for some time to come.”
Home foreclosures will climb through late 2010, peaking after the unemployment rate reaches 10.2 percent in the second quarter, the mortgage bankers said in an Oct. 13 forecast.
RealtyTrac reported that 343,638 properties received foreclosure filings in September alone, the third-highest monthly total behind July and August of this year. The September number fell 4 percent from the previous month, though it climbed 29 percent from a year earlier.