URBAN INSTITUTE: DECADES OF FORECLOSURES TO COME

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EDITOR’S NOTE: For those seeking to buy a home to live in, and for those seeing to buy a “bargain” for investment BEWARE! The pressure on this housing market will not stop until the foreclosures are stopped and the real process of modification and settlement begins.

Downward pressure on the housing market can’t be manipulated successfully at these volume levels. Everyone knows that there are millions of homes that are not YET for sale but will be if the present inventory is ever sold out. And most people are getting to know enough information about title to realize that they might be buying the property from someone who doesn’t own it or who acquired title through fraudulent or defective means.

Canadian buyers are looking for “bargains” under $100,000. They are in for a rude surprise when they discover that the price drops well below what they aid even at these levels.

SEE FULL STORY ON HOUSING WIRE

by KERRI PANCHUK

The number of seriously delinquent mortgages in the nation’s largest metropolitan areas slowed this year, according to a new study from the Urban Institute. But foreclosures remain a burden on the housing market, prompting the policy research group to call for a resolution to the housing crisis to ensure the foreclosure backlog is cleared out in a reasonable time period.

The institute said the serious delinquency rate in the 100 largest metro areas slowed to 9.3% in June from 10.4% in December 2009, according to data from Foreclosure-Response.org. The Urban Institute said the serious delinquency rate is classified as the share of loans in foreclosure, plus all of those that are more than 90 days in arrears.

“The foreclosure inventory that is building up is going to take an incredibly long time for lenders to clear,” said Leah Hendey, research associate at the Washington firm. “At the current pace of foreclosure sales, we are looking at a process that could take decades to complete. It is critical that the status of these properties be resolved quickly if we want to stabilize communities and housing markets.”

This decline was driven by a drop in delinquent loans, which fell to 3.7% in June from 5.5% in December 2009.


In hard-hit areas like Riverside and Stockton, Calif., the foreclosure rate declined significantly, dropping 1.9 percentage points and 1.7 percentage points from the peak two years ago.

Florida, New York and Illinois experienced a different shift in the market with foreclosure rates climbing in cities throughout those states.

In Tampa, the foreclosure rate jumped 2.8 percentage points, and in Chicago, it grew 2.3 percentage points. Those three states are judicial foreclosure states, which force a court to make a final decision before a property can leave the process. This leads to a growing backlog, the Urban Institute said.

Mortgage originations are down in all of the 100 metro areas surveyed, as well. Some of the largest drops occurred in Buffalo, N.Y., where originations fell 39% this year, and Miami, where new home loans fell 82%, the report said.

Write to Kerri Panchuk.


 

14 Responses

  1. Hmmm…

    I liked it a hell of a lot better when I was young and dumb…

  2. “the federal govt would not justify its continued existence——except to protect assets of those superrich that find the US to be evolving into a pirates haven”

    Way too true already. The obvious concern is that America is so dumbed down that they won’t realize how bad things have gotten until half of us have already been thrown under the bus. Or out of our houses.

    “….Tom Miller” or “foreclosure settlement” and “Iowa caucuses” yield no results.”

    That can be read literally, as well as figuratively. We can expect zero results from any of these clowns prostituting themselves in Iowa as we speak. The state slam is true to form tonight….”Idiots Outside Walking Around”.

    In a democracy, or a republic, one would expect, especially in such tough economic times, that a plan as grandiose as the FEMA deal would be discussed a wee bit, don’t you think? The total lack of transparency of that whole deal doesn’t sit well with me. But then again, there’s nothing transparent about our representatives these days — save for their gluttony and willingness to turn tricks for a buck. Sluts, one and all.

  3. They didnt mention the detention camps in Iowa —nor foreclosures; lotta choices here;
    ” DAILY DELANEY DOWNER – For the past year, Iowa Attorney General Tom Miller has led a coalition of state AGs in search of a reckoning with the nation’s biggest banks over homeowner abuse and rogue foreclosures. The settlement — which could provide as much as $25 billion of relief for mistreated current and former homeowners — is currently the biggest thing happening in the housing-policy world. The deal, which might be inked as soon as this month, has the support of every attorney general except for a handful of Democrats who have complained it’s too soft on the banks. Yet even though the top cop negotiating the settlement is headquartered in the state where Republican candidates are frantically campaigning, none of them, apparently, has uttered a word about the settlement. HuffPost reporters who have been covering campaigns in Iowa for the past week or more and haven’t heard a peep about foreclosures. A news database search for the terms “Iowa” and “caucuses” and “foreclosures” turns up no comments from the candidates or their surrogates on the topic. Google news searches for terms like “Tom Miller” or “foreclosure settlement” and “Iowa caucuses” yield no results.

    HuffPostHill

  4. That’s alright. When they have taken all the houses away, they’ll house us in little 8 X 8 cells and we’ll be able to work for them. Apparently, there are about 12 bids to build those FEMA camps nationwide… and i doubt it is for Iranians or Afghans…

    http://www.americanthinker.com/2012/01/new_nationwide_fema_camps_should_raise_eyebrows.html

    Oh God! I so much don’t want to believe any of it!

  5. yep they got us where they want us–question is why do they want us there? Its like they are playing monopoly and the only way to win is to seize everything the other players have

    but when they deny your social security and deny your pension –its handwriting on the wall for your children and grandchildren that the system fails the tests laid out in the Declaration of Independence–if these things come to pass the federal govt would not justify its continued existence——except to protect assets of those superrich that find the US to be evolving into a pirates haven

  6. my experience is that attys dont want the business—they want the plain vanilla $1500 up front “fill in the form” bankruptcy stuff—–not trying to unravel securitizations and take hopeless runs at free houses—–the clients cant often divert $$$ from pmts and food to fund attys———–its not lucrative–the ones iv seen handle 200-500 foreclosures annually and basically just do awful settlements–in effect put seasoning onto your body before throwing you in the meat grinder

  7. could be a much worse cliff than only added $1000——-if they paid the less than full interest pmt —-and were paying say 2500/mo—–the underpayment aka negative amortization of up to 120% of original principal will reset so as to recover the 120% by 20 yr amortization plus the 5-7% crazy base ARM—could easily double pmts

  8. they get your life insurance and the assets you have in your ira –pension when you croak——-if you did not file bankruptcy along the way to terminate the note or deficiency

    it is awful when you add in the liklihood of early death and/or suicide that they try to induce—-just to get at your assets after death—its probably an algorithm built into their servicing platforms

  9. @DCB,

    Not only that but in every so-called “primitive” (read non-civilized, per developped countries definition…) older people are taken care off by their younger relatives. They are honored for having given us birth and worked so hard to raise us.

    After a certain age, their grown children make sure they never lack anything and are not left homeless.

    America has taken away the jobs grown children count on to raise their own kids. Now, America is going after the elderly by taking away any means of subsistence. And, to top is off, America is taking away birth control to force us to have kids we will NOT be able to raise.

    Who is “civilized”? Why not simply decide that, at 65, they’ll be considered a burden and shoot them like animals?

    It will end up very, very badly…

  10. Don’t forget about the tsunami of wrongful foreclosure lawsuits that are waiting in the wings as more and more of the truth gets out. If you are an attorney who needs work, try foreclosure defense. It is pretty much endless in its possibilities.

  11. Wonder how many option arms are recasting as we speak including big jumbo loans in CA. Low interest prevented this from happening over the five years option period for the “prime” alt a borrowers who did not take out 100% ltv. But fully amortized now in this economy is a different ballgame – $1000 added to the payment might not be sustainable even for the employed – plus underwater even if you had 50% ltv – so if mortgages that originated last half of 2006 and going forward go delinquent…..this has only just begun.

  12. If they ever get through all the inventory it will be a blessed miracle, never mind the new houses and housing developments that continue to spring up out of no where.How can you build more when you can’t sell what is pre-exsisting.No common sense left inthe world.You can’t build what you can’t sell.No people with good credit left.

  13. @DCB
    “work till we drop–dead hopefully”

    AND pay interest on debts to them that can never be repaid even after we drop dead.

  14. Off topic but something to think about. Today’s Financial Times oped, the voice of Wall street and London bankers expressed the opinion that retirement social security should be terminated globally and replaced with a disability payment system. Thus the paper notes [in contradiction to what I see every time I go to the doctor’s office, and feel in my bones much of each day] that the average person is able to work until they reach 78 years of age and that it is bad public policy to “PAY HEALTHY PEOPLE NOT TO WORK”

    Think about that–no retirement basically. Nothing back from the 40 years’ contributions to the social security system. Govt hoping you will die immediately upon becoming disabled–or simultaneous events. Wouldnt be as scary if govt did not control your health care too—a few less pills might help that “work till you drop dead” plan.

    and lest you say–well we never really expected them to make good on that promise to give back some of that 15% combined employee/employer contribution, we expected to live on our private employer pensions—as most white collar types do–there is also an article for you.
    At the 2nd section of that same paper, the article-[not oped] notes that the degree of underfunding of defined benefit pension plans is worse now than at the peak of the 2008 financial disaster–with average plan being underfunded by 25% —and growing rapidly because there are just too many boomers with the gall to get old and approach retirement–ie ask for that long-promised benefit.

    The companies collectively are petitioning the US regulators [tim geithner?] to extend the period that they must make up the shortfall and/or modify the shortfall makeup provisions to give the companies relief. Is it because the companies have no money? No–the article notes that companies are sitting on unsurpassed cash reserves which they intend to use for stock buybacks [vs something useless like meeting pension promises?]———and of course these same companies are making record profits even after booking the accrued pension expense.

    bottom line is they want us all [except 0.1%] to work till we drop–dead hopefully] –after all warren buffet still manages to drag himself to his chauffered limo and his private jet with a private duty nurse in constant attendance–why cant we all?] Sound like Marie Antoinettes refrain–“if they cant find bread to eat, let them eat cake”

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