June Foreclosure Rate Up 53 Percent From A Year Ago

WASHINGTON — The number of homeowners stung by the rout in the U.S. housing market jumped last month as foreclosure filings grew by more than 50 percent compared with June a year ago, according to data released Thursday.

Nationwide, 252,363 homes received at least one foreclosure-related notice in June, up 53 percent from the same month last year, but down 3 percent from May, RealtyTrac Inc. said. One in every 501 U.S. households received a foreclosure filing last month.

Foreclosure filings increased from a year earlier in all but 11 states. Nevada, California, Arizona, Florida and Michigan continued to have the highest foreclosure rates.

Irvine, Calif.-based RealtyTrac monitors default notices, auction sale notices and bank repossessions. More than 71,000 properties were repossessed by lenders nationwide in June, the company said.

While foreclosures continue to rise nationwide, efforts in some states to give borrowers more time before losing their homes appear to be working.

In Maryland, where a new law has increased the time to finalize a foreclosure to 150 days from just 15, foreclosure filings dropped by almost 18 percent from last year's levels. In Massachusetts, which last year passed a similar law, filings dropped almost 3 percent.

Still, the combination of weak housing sales, falling home values, tighter mortgage lending criteria and a slowing U.S. economy has left financially strapped homeowners with few options to avoid foreclosure. Many can't find buyers or owe more than their home is worth and can't refinance into an affordable loan.

Economists project 2.5 million homes nationwide will enter the foreclosure process this year, up from about 1.5 million in 2007.

Analysts say the mortgage industry's effort to assist troubled borrowers is being overwhelmed by the magnitude of the foreclosure crisis, and Treasury Secretary Henry Paulson said earlier this week that many foreclosures are "not preventable," citing borrowers who "took out mortgages they can't possibly afford and they will lose their homes."

Lawmakers and government officials have been struggling to come up with a response to soften the blow for the U.S. economy. Congress is working on legislation that would permit the Federal Housing Administration to provide new, cheaper mortgages to distressed homeowners who otherwise would have difficulty refinancing into more secure government-insured loans. Lenders would have to be willing to take a substantial loss by reducing the amount owed on the loan.

The Bush administration announced Tuesday that it would be ready on Monday to implement an FHA expansion that lets borrowers who've fallen behind on their home payments _ because of mortgage rate resets or other economic hardships _ get more affordable loans.

In the RealtyTrac report, metropolitan areas in California and Florida accounted for nine of the top 10 areas with the highest rate of foreclosure for the third-straight month. That list was led by three California cities: Stockton, Merced and Modesto. The Cape Coral-Fort Myers area in Florida was fourth.

In Nevada, one in every 122 households received a foreclosure-related notice last month, more than four times the national rate.

In today's market, about 50 to 60 percent of borrowers nationally who receive foreclosure filings are now likely to lose their homes, said Rick Sharga, RealtyTrac's vice president of marketing, compared with a typical rate of about 40 percent.

"For more and more homeowners who are getting into foreclosure," Sharga said, "there is a much higher likelihood that they are ultimately going to lose the properties to the bank."

___

On the Net:

RealtyTrac Inc.: http://www.realtytrac.com

Comments

[BuckFush666]

12:42 PM on 07/11/2008

Im done....it­s this freaking energy prices coupled with the housing and credit markets thats killin me. Its as if Banks and Oil companies decided to run thier businesses pourly all at the same time. I mean its so ridiculous all I an do is watch the hilarity that goes on at Risque Agency.

[Chavez08]

09:54 AM on 07/11/2008

"Privatise the Profits, Socialize the Losses."

Marx was SOOOOOOOO right about Capitalist­s.

[Big0725]

07:53 PM on 07/11/2008

Amen.

[SisterAnn]

09:07 AM on 07/11/2008

I wrote, "You could end up paying on a interest only mortgage for 60 or 70 years and still not own a home, unless housing went up." It should have been written as " unless housing went up and you sold it for twice what you gave for it, then turn around and buy a house worth half as much.

[booksnmore4you]

03:45 AM on 07/11/2008

Even the airport is becoming a ghost town.

College costs have risen.

Everyone seems to buy gas with credit cards - not their choice, it costs more than cash.

Small businesses are closing. Grocery stores have closed.

Food prices have gone through the roof. For the poor, what used to be a months worth of food stamps now stretches two weeks.

[Graywolf48]

08:17 AM on 07/11/2008

booksnmore­4you: Just chill, relax. It's just your imaginatio­n, so quit your whining. The economy is fine, a little sluggish perhaps, but fine. The sky is indeed a beautiful azure blue in Bush World. And as Republican spin masters have so truthfully admitted many times before, they create America's reality, so learn to enjoy GOP reality and ignore your own reality. After all, it really isn't real, it's all in your mind. Just kick back and keep repeating, "every thing's fine, it's all in my mind". And if you buy into all that, vote McBush in '08. A great many people, perhaps even the majority who go to the polls will.

[booksnmore4you]

03:42 AM on 07/11/2008

Everywhere I drive in my county it's like a depression has hit. The middle class is disappeari­ng. Homes once valued at 400K sit unsold for 200K amidst a market flooded with such homes. Drive the streets and you can hardly blink before you see another family no longer gone. Property values are kaput.

Meanwhile, housing for the poor has gone from $800 a month to $1300, except for places where the schools are failing and the streets are not safe. You can still get those.

Large developmen­ts sit half-devel­oped, abandoned.

Jobs are going or gone.

Wages have not risen.

People making 30K per year spend one-third of their salary just going back and forth to work, on gas.

Electricit­y has risen 20% and will rise even more in 2009.

Health care costs take more of the average family's paycheck.

People cannot fix their cars if they break down or cannot drive if the tires go bad.

Thanks, Bush.

[SisterAnn]

08:39 AM on 07/11/2008

Are you whining? You know Grahm and McCain don't like that.

You can add:

The stock market has dropped 20% from the high.

They say heating costs will double this winter.

230, 000 homes have been forclosed on in each of the past months and the number is headed higher.

[darthdarcy]

11:03 PM on 07/10/2008

Thank Phil Gramm and these swindlers and criminals running our country...­and our corrupted Justice Dept..that will not enforce laws against Republican swine like Gramm and Rove...or Bush..

[Weathermaker]

10:34 PM on 07/10/2008

Reckless lending is only possible if it is matched by reckless borrowing. Many people took huge mortgages (4-5 times their annual income) thinking that home values will only go up. Now they're in trouble. A quasi-safe and sane approach would be "only buy a house whose value is less than the down payment you can make plus three times your annual household income".

[tonyrich]

03:17 PM on 07/10/2008

You know it is nteresting that we can have the Government bail out Bear Sterns, and when it comes to protecting the American people the answer is the same were working on a plan. I don't face the prospect of foreclosur­e, but know several people who do. Why we have a corrupt administra­tion, a do nothing Congress, an unnnecessa­ry war, We have gas priceand food price up. And what is our government doing. WERE WORKING ON A PLAN. Same old BS defferent players

[research]

03:58 PM on 07/10/2008

BushCo has plenty of dirt on the democrats, so fascism is forward full speed ahead.

That's corporatis­m, they like poor people cause they are subservien­t.

[Chavez08]

10:02 AM on 07/11/2008

The Fascists in Washington will win over the Liberals because they have shown repeatedly they will do anything for their cause.

They will bomb the hell out of any country resisting Corporatis­m and Washington is knowingly, willfully bank-rolli­ng assassinat­ions of unarmed union organizers all over the world (fact) All this shows the Right Wing Corporatis­t mafia will die and kill for their cause without regret or critical thought.

Liberals aren't willing to sacrifice enough for their cause like the Fascist flying monkeys will, so they will lose the war of ideals. Liberals just whine, they don't sacrifice nor do they organize well.

Luckily, corporatis­m is killing itself, that's the onlly saving grace Americans can count on.

[bola47]

03:08 PM on 07/10/2008

no problem here. phil gramm says it is all in our minds.

[research]

03:57 PM on 07/10/2008

just mental...

[booksnmore4you]

03:50 AM on 07/11/2008

Oh, sheesh, what a relief. And to think I thought it was real! Silly me.

[swift goat pet for truth]

12:08 PM on 07/10/2008

I can't tell.

Is this a new story, or an old one with the month changed?

[research]

03:56 PM on 07/10/2008

just cause it went down 3% it's still 50% worse then last year....

[Egalitare]

07:14 PM on 07/10/2008

Prosperity is just around...t­hat corner ...waaaaay over there.

[MissingAmerica]

11:40 AM on 07/10/2008

My son is a commercial electricia­n and the jobs are disappeari­ng. Rather than face job loss, unemployme­nt which would cause the inability to make the house payments, and an inevitable foreclosur­e, they chose to be proactive. They sold their house at nearly a $100,000 loss (and they are not wealthy) and will have to live in their camper/tra­iler for at least three years, longer if he fails to find work. They are driving to where the work is and praying that it lasts long enough to justify the gas expense to get there. They've had to take up a nomadic lifestyle and cut their expenses in order to survive, and we have no idea when we will be able to see each other again.

I wanted better than this for my family, as did we all. Bush and this Congress are killing us. I for one am sick of hearing that we are entering a recession, when those who have lived through it will tell you that we are entrenched in a depression­. It will take patriotism­, brains and guts to get us out, and it doesn't appear that we have that right now. Congress is supposed to protect us, but there is no one to protect us from this Congress.

[fact finder]

04:41 PM on 07/10/2008

Missing America' HEAR, HEAR.

[Chavez08]

10:11 AM on 07/11/2008

This should be on the front page!

[Harrier]

10:10 AM on 07/10/2008

A year ago, I said as bad as it was then, it would be twice as bad a year into the future. Now I will say it again, unless the laws are changed to protect the home owner and put the onus of ethical lending the lender and restrictio­n mortgage bundling, a year from now, you will not only see twice the rate of foreclosur­es, but a credit market that will push the overall economy into one of the longest lasting recessions this country has ever seen. I don't see anything signifiant done by either the feds of lawmakers in the hill an nody offering more than band-aids to patch something that requires major surgery.

[MilwaukeeDan]

09:59 AM on 07/10/2008

"Many can't find buyers or owe more than their home is worth", I need an explanatio­n, when you have a mortgage, don't you always owe more than the home is worth? What about the interest? Last year, I had a real estate friend calculate what a $100,000 motrgage would cost for a 30 year period at, I think 6.25%, wound up over $220,000.

[AngryAmish]

10:10 AM on 07/10/2008

It's what the homeowners owe now--i.e., if they were pay off the loan today--tha­t exceeds the home's value.

[jood42]

11:13 AM on 07/10/2008

This is the correct answer. A mortgage is not like a fixed loan, where you owe the full amount of interest no matter when you pay it off. You could pay off your mortgage today by paying off just the principle and you wouldn't owe any additional interest.

[thegreatgiginthesky]

10:39 AM on 07/10/2008

It is based on what you owe on the home now. If you have a $100,000 home and you've lived in it for 15 years, 15 years of payments have been made and you no longer owe $100,000 on the home it is considerab­ly less. For argument let us assume you owe about 75,000 after 15 years. Which gives you equity of about $15,000 after 15 years. Plus, let us assume that the home has appreciate­d another $10,000 in that time period. So if you sell your home now you should be able to list is for 110,000. Problem is that the appreciati­on of homes have dropped off which causes the homes to be valued at $70,000 so you end up selling for $70,000 and are still in hole to the bank for $5000.