Friday, November 09, 2007

Is the worst over?

The trauma of foreclosure or impending foreclosure has hit home for nearly 1.4 million homeowners so far this year, maintaining the nearly 91 percent year to date increase versus the last year. That’s according to the latest numbers from California-based, which has been analyzing and publishing real estate and foreclosure data for more than 15 years.

For the month of October nationwide 54,418 REO (Real Estate Owned by lenders, newly foreclosed homes) filings were reported to (up nearly 24 percent over the 43,941 September filings). A total of 128,019 pre-foreclosure filings were reported for October (up nearly 31 percent over 97,984 September’s filings).

These are grim numbers for the hundreds of thousands of homeowners trapped by rising mortgage payments, stagnant home prices, and tightened credit markets. “But all is not gloom,” says Alexis McGee, president of
“However, remember that in September nationwide both REO filings (43,941 versus 55,952) and pre-foreclosures filings (97,984 versus 117,694) were down over August (16.75 percent and 21.47 percent respectively). When you average September and October filings, you find that pre-foreclosure filings have actually leveled off (down 4 percent) since August (113,001 current versus 117,694 August) and REO’s have actually dropped significantly (down 12 percent) from the high August filings (49,179 current versus 55,952 August).”

“Although tens of thousands of other homeowners are `in foreclosure' most have not lost their home to foreclosure, as they have found solutions to their mortgage woes, ranging from workouts through lenders or other private and public organizations to rising home prices that make refinancing and home sales plausible, and growing local and national economies,” adds McGee.

Just last week, the U.S. Commerce Department reported the nation’s economy grew at a faster than expected 3.9 percent in the third quarter. Combine that with the 3.8 percent second-quarter GDP, and our economy is experiencing the strongest national growth rate in four years. And the Labor Department just reported that the economy turned out 166,000 new jobs in October vs. the 80,000 consensus forecasted. All that has happened under the cloud of the subprime mortgage industry meltdown!” No matter the hype you hear the pattern of foreclosure and pre-foreclosure filings that climb month in and month out in every state has been broken, says McGee. “Overall national foreclosure-related numbers may sound high, but the 91 percent year over year increase is in relation to historic base lows. In addition, every month there’s a bit of good news on the foreclosure front. Individual states and regions are reporting flat or dropping numbers of foreclosure and pre-foreclosure filings. That’s sometimes a tough-to-see reality amid what can be overwhelming numbers. For some areas the worst of the foreclosure crisis could be over.”


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