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Last October 31, the Administration placed a moratorium on new foreclosures. In February 2009, the Obama administration announced a new housing rescue plan that gives incentives to mortgage companies and investors to reduce payments to affordable levels for qualifying homeowners.
The October 31 moratorium expired March 31. Since then, banks have gone back to their original foreclosure procedures. They have by now sifted through loan files, decided who they can help, and are foreclosing on the rest of the delinquent homeowners.
The numbers for this year are quite discouraging. American families threatened with foreclosure grew by 24% this year and this number is set to keep rising. Nationwide, nearly 804,000 homes received foreclosure notices from January to March, up from 650,000 a year ago. RealtyTrac, which publishes data on foreclosures, said that 340,000 properties were affected up 17% from February and 46% higher than a year ago.
One obvious effect of the increased foreclosure action will be a further decline in housing prices. According to the Wall Street Journal, "Ronald Temple, co-director at Lazard Asset Management, expects home prices to fall by 22% to 27% from their January levels. More than 2.1 million homes will be lost this year up from 1.7 million in 2008 according to Moody's Economy.com."
Do you believe that we will see another drop in home prices this year?
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Reader Comments (Page 1 of 1)
4-16-2009 @ 10:13AM
janice skorupa said...
It was all a scam> Until the banks got their bailout money, they agreed to anything. Don'T kid yourself...the banks make money on foreclosures. They did little or nothing to help homeowners. Obama's plan failed just as his political promises are not being realized by the American people. Over the years we keep blaming prior administrations. It's always the last guy who messed things up, even on the local government level.
4-16-2009 @ 10:46AM
matt said...
If you can't pay your mortgage, you should BE RENTING! My cell phone bill is too high because I talk on it so much, I think the Obaminator should give ATT some incentives for lowering my bill so that I can continue to be negligent and overextend myself.
4-17-2009 @ 12:26AM
Robert Hogan said...
Janice, can you explain to me how banks make money on foreclosures?
The house across the street from me has been in foreclosure since before I moved in last July, and has sent empty all that time. I would love to know how the bank is making money on an empty house.
4-16-2009 @ 1:47PM
Robert Hogan said...
Janice, can you explain how banks are making money on foreclosures?
There is a foreclosed home on my street that has sat empty for ten months. I would love to know how the bank is making money on this house.
4-16-2009 @ 2:49PM
GenKhan2 said...
Further decline in home prices? Yes please. Here's to another 30%. Prices are not at reasonable levels yet. The public also needs to be weaned of its ideas about homes as the ultimate wealth generator. There's no better way for that to happen then having everyone lose their shirts.