Foreclosure Rate Rises 17 Percent

[anarchist]

http://www.washingtonpost.com/wp-dyn/content/article/2009/09/30/AR2009093001696.html?hpid=topnews

 

[wordnerd]

A lowered payment isn't enough when a person does not have any income

[Domscott66]

It will get much worse with these Option ARM loans. I have an option ARM loan and cant refinance because the house is valued 45% less than what I paid..and I put down 15% on the home. It is a fixed rate now and will be for two more years then turns to an ARM. I picked a 7 year plan however where most pick 3-5 year fixed rates. As the Feds, to hedge off inflation, start raising interest rates, many home owners who have had their fixed turn to adjustible will be soooooooo screwed.

We have seen the small spattering of those who are losing their jobs but not the big leap when interest rates start to rise along with unemployment and the inability to refinance because home prices will not rebound as fast as it would need to restore the values to within government required loan % of value. I am not sure what percentage of the loans are in this condition but I doubt I am alone in this situation. I am lucky however that I have two years before I am totally messed over. I have debated on letting the house go, suck up my 7 years of bad credit, and buy again or through a family member to buy at a low instead of waiting.

Either way, I think the low hanging fruit is being lost right now but there is so much ripe fruit for picking and we have only seen the start of the housing bubble pop.

[periol]

It will get much worse with these Option ARM loans. I have an option ARM loan and cant refinance because the house is valued 45% less than what I paid..and I put down 15% on the home. It is a fixed rate now and will be for two more years then turns to an ARM. I picked a 7 year plan however where most pick 3-5 year fixed rates. As the Feds, to hedge off inflation, start raising interest rates, many home owners who have had their fixed turn to adjustible will be soooooooo screwed.

We have seen the small spattering of those who are losing their jobs but not the big leap when interest rates start to rise along with unemployment and the inability to refinance because home prices will not rebound as fast as it would need to restore the values to within government required loan % of value. I am not sure what percentage of the loans are in this condition but I doubt I am alone in this situation. I am lucky however that I have two years before I am totally messed over. I have debated on letting the house go, suck up my 7 years of bad credit, and buy again or through a family member to buy at a low instead of waiting.

Either way, I think the low hanging fruit is being lost right now but there is so much ripe fruit for picking and we have only seen the start of the housing bubble pop.

Textbook example of why things are going to be getting worse in the housing market.  The mortgage folks know the numbers, and just because they put a happy face on doesn't mean there are large numbers of ARMs that start triggering over the next few years. There's lots of reasons the FED is keeping the primate rate as low as posiible, but this is a big one, and they know it has to stay low for a few more years. 

Good luck man.  If I were you I'd try to get out of the home ASAP. 

[Ty Fjoyd]

Using typical US Govt logic, the solution is simple:

1. Pass legislation banning foreclosures; and
2. Pass legislation giving "vouchers" to unemployed homeowners which they can use to pay their mortgages.

 

[Bill Hicks]

Using typical US Govt logic, the solution is simple:

1. Pass legislation banning foreclosures; and
2. Pass legislation giving "vouchers" to unemployed homeowners which they can use to pay their mortgages.

 

Don't forget, backstop every new mortgage issued in a desperate attempt to prop up unaffordable prices.    

[picasso moon]

How about legislation prohibiting home values from dropping?

[Arraya]

Ha.. That would have been a lot cheaper and more effective than everything else they have done.