We are experiencing increasing foreclosures in the nation. According to RealtyTrac’s 2008 U.S. Foreclosure Market Report, a total of 3,157,806 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 2,330,483 U.S. properties during the year, an 81 percent increase in total properties from 2007 and a 225 percent increase in total properties from 2006. The report also shows that 1.84 percent of all U.S. housing units (one in 54) received at least one foreclosure filing during the year, up from 1.03 percent in 2007.
There are several issues which help in increasing number of foreclosure. Although Obama’s loan modification initiative has been in place for five months and incentives are being offered to lenders who agree to loan modification proposals, we still experiencing increasing foreclosures.
There are several factors responsible for these increasing number foreclosures. Increasing rate of unemployment is an important one. Reports say that unemployment rate hit 9.5%. It is very hard to keep on mortgage payment after being unemployed. This situation results in poor credit rating of the person. The end of foreclosure moratoriums also contributed in increasing rate of foreclosures. Decline in the prices of homes affects directly to foreclosure growth. Falling home values have dragged more than 20% of American homeowners “underwater”—meaning they owe more on their mortgages than the property is worth. Political pressure on mortgage service providers have also contributed to this problem. These services providers are under pressure to double their efforts. Despite this pressure, experts expect foreclosure rates to rise into next year. “It’s going to keep on getting worse until the unemployment rate peaks, which we think will happen in about the middle of next year,” an expert said.
