Nationwide headlines are continued to be dominated by foreclosure news and the increasing rate of unemployment. Reports say that almost 6% of homeowners are either in the rears on payments or at the cusp 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. This was illustrated in a recent study showing that areas which had large numbers of subprime loans also had increased numbers of foreclosure filings as well. In states where there is a predominance of foreclosure news, subprime mortgages consist of as much as 50 percent of the cases.
Researchers tried to study other factors which could affect the number of foreclosures in an area. The factors included the value of the home, the race of the homeowners and their income levels – but what they found is that the predominant factor was the sub-prime rates. 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. This fact has lead agencies such as the Federal Reserve Bank of Boston to take up the cause of unemployed homeowners and recommend for more lenient policies in their behalf.
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.) The government is trying to assist with various policies and legislation, but it is unclear on what impact it will have. 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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