Foreclosures Double In First Quarter

April 30th, 2008

Research studies show that far from slowing down the foreclosures have doubled during the first quarter of 2008 in comparison to what it was in the previous year. Falling real estate markets together with tightening of mortgage loans are held responsible for this situation. More and more houses are not being sold off at court auctions.

The three top offending states are Nevada, Florida and California. In California, Stockton has reported the highest number of foreclosure postings in the country. It is 6.6 times higher than the national average according to RealtyTrac.

Figures across the nation show that 649,917 houses were included at least once in the foreclosure listings during the first quarter of this year – 2008. This is 112% higher than the previous year when the numbers recorded were 306,722. The counting also shows that since the last quarter the rise has been higher by 23%. It means that one out of 194 houses have been foreclosed during this first quarter. The first quarter is also the seventh consecutive one registering a rise in foreclosure activity. Except for four states, foreclosures have increased in US. By foreclosure reference is made to all the stages of the judicial process – default and auction sale notices together with bank repossessions.

In the foreclosure mire, Pennsylvania seems to be coming out clean with a drop of 24.4% in foreclosure postings from the previous year. For this the laurels are being awarded to the foreclosure measures taken by the state. Philadelphia and other cities put a hold on foreclosure auctions due in April and enforced other preventive measures. These seem to be paying dividends.

Rick Sharga of RealtyTrac comments that unless the market comes back to normal levels, with people buying properties again, the foreclosure crisis will continue to harass the country. Loans are now no longer easily available to people with shaky credit and there is no significant reduction in down-payment. This is also considerably reducing the number of potential buyers. It is a vicious cycle that will not be easily broken right now.

The recent sweeping waves of foreclosures also indicates that the much hyped foreclosure relief programmes is not having much impact. However HOPE NOW, a help group launched by the Bush government, claims that during the first three months of this year, about 503,000 house owners had been helped by way of mortgage help. However the nature of the aid was mostly temporary.