In the first quarter, almost half of the overall increase in the start of foreclosures was due to the increase in prime, fixed-rate loans, according to the Mortgage Bankers Association. The pace of prime borrowers going into foreclosure is accelerating, especially in states with mounting unemployment or property values that saw a big run-up during the housing boom.
California, Florida, Arizona and Nevada represent 56% of the increase in foreclosure starts, including half of the increase in prime fixed-rate foreclosure starts. That coincides with states reporting some of the highest unemployment rates. In California, the unemployment rate in April was 11%, according to the Department of Labor. In Nevada, it was 10.6%.
It's a marked shift from earlier this year, when foreclosures were driven by defaults on subprime loans. And it has major implications — ruining the credit scores of borrowers who once had unblemished records and dragging down property values in more affluent neighborhoods.
Tomorrow, I'll talk about the new three month moratorium on foreclosures that started yesterday in California...good news for some homeowners.
1 comment:
If a good real estate agent can help grease the wheels and get your offer in front of a lender, you can get an answer more quickly, and potentially close more deals.
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