1.2 Million Homes in Foreclosure
Last Friday Mortgage Bankers Association (MBA) issued a report showing a record 1.2 million homes were in foreclosure during the second quarter of 2008. This was 2.8% of all outstanding loans, and double the same period last year.
During the three months ended June 30, 2.9 million homeowners, or 6.4%, were behind on their payments, up more than 25% from last year.
Jay Brinkmann, MBA's Chief Economist said: "The national foreclosure numbers continue to be driven by the hardest hit states that are continuing to get much worse. The increases in foreclosures in California and Florida overwhelmed improvements in states like Texas, Massachusetts and Maryland."
California and Florida accounted for 39% of all foreclosures started during the quarter.
A few of of our past posts on home foreclosures:
Survey Says Home Values Must Fall Another 14%
A Record Number of Homeowners Avoid Foreclosure in the Second Quarter
Jumbo Financing and the Impact on The San Diego Real Estate Market
Home Builders Pushed 100% Loans to Move Properties
San Diego County Foreclosures up 125% from 2007
CALIFORNIA HOME FORECLOSURE SALES JUMP 22.5%
Credit Impact of Real Estate Short Sales & Deeds In Lieu
Just because people with funny money from stocks and people who got loans who could not afford them drove prices up doesn’t mean this will last. A home is still your best investment in my opinion.
San Diego Attorney
Given the ratio to income to sales price in Calif the foreclosure crisis will be a Calif problem for many years. Until the recent bubble lending 3 times income was a good yardstick but now it ranges from 6 to 10 times income and this has become the norm. A good example would be the city of Santa Rosa BMR problem that has a cap of 50K income for houses costing 304K using the FHA 3% down program. Low income cannot afford a 300K home, only in Calif is this type of thinking keep alive by local and state gov’t. In fact the State yesterday wants to give low income families 100% financing for foreclosure homes in the most impacted parts of the state. These homes require extensive rehab which low income citizens do not have and will again provide a new wave of foreclosures in the coming years.
Lasik Specialist
San Diego
If you are going to buy a home that you are planning on living in, buy one that you can afford, taxes and insurance and maintenance included. The “asking” price does not tell the whole story, nor does the “adjustable” loan. People paid too much thinking they could flip the house, found no buyer and the adjustable loan was “adjusting”, just like they’d been warned. Of course, no one fore saw the gas prices, the electricity prices, the food prices going through the roof, and all the unemployment.
Cosmetic Surgeon
If you could not afford to buy a house then you should not have. Plain and simple.
Clinical Researcher
Not all foreclosures are due to bad mortgages. I would imagine a healthy number are from folks being out of work too. High and prolonged unemployment has gotta spike the foreclosures.
Bail Bonds
This is the result of cooking the books to give home loans to people who otherwise couldn’t even get a car loan. The lenders and the borrowers are equally to blame. They created the bubble that burst- and who are the true victims?– those of us who could actually qualify for the loan and are still making house payments and homes that are rapidly depreciated due to the crooks and liars who cooked the books.
Tijuana Dental Specialist