Foreclosures are soaring while banks are suffering losses from short sales. The story of Drew Schlosser is one of many. For two years he tried to sell his condo unit in Punta Gorda, Florida having 3 bedrooms facing a water body. Recently it went through Wells Fargo who has given the nod to accept a loss of $165,000 on the mortgage loan. Schlosser had got an offer for $155,000 on the unit but Wells Fargo, based in San Francisco took five months to agree to the short sale. Other offers had failed to materialize because of the inordinate delay. 31 year old Schlosser referred to the situation as a sort of mess. One can only sell the house in a short sale only if the buyer is patient and willing to wait with the offer standing.

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Manuel Sanabria is determined not to be bogged down by life’s misfortunes. Once a Mariner in Iraq, the man returned to Florida only to find his home foreclosed and debt piling up. His home will soon be auctioned and he along with his wife will move to his mother-in-law’s home.

Twenty five year old Sanabria is confident that he will be able to restart life “I am young and I have seen worse,” he says with rare optimism. But there are others who cannot garner the courage that Sanabria has shown. These veterans of the Afghanistan and Iraqi wars are completely crushed by the economic crunch and what’s worse some of them have developed mental and physical problems.

There are no precise numbers to corroborate this. Recently the Congress has asked the Veterans Affairs Department to investigate into the number of people who have run into foreclosures. The Army has also begun operations to help people with foreclosure filings.

Bobby White, director of Fort Lauderdale’s Vet Center, said there are several local bodies who are offering financial aid to soldiers who in Afghanistan and Iraq.

White says that the recession has affected all. For the veterans, however, this is more of an uphill struggle than the ordinary citizen.

Justin Wells, an employee of Veterans Support Organization’s South Florida chapter, says his organization gets calls from veterans who want help with electric bill, rent and mortgage payments.

However, Sanabria says that the aid he received was too meager and he got it too late. When his wife Laura, lost her job, they tried to palm off the spacious house for $70,000. But they could not. The couple found it very difficult to pay the bills. Now Laura has taken up a nursing course and is determined to put her act together.

Sanabria had joined Marine Corps after finishing class XII in 2002. He served his country in Iraq and was injured in 2004. Two of his friends were killed in the encounter. Sanabria was hospitalized and after he was cured he took up home in Broward County. They had invested $50,000 on the house.

Sanabria also enrolled for a residential program to adjust to his new civilian life. Although he says that he has never been better, yet his stress levels suddenly rose when he had heard that the condominium where his mother-in-law lived would not allow his two service dogs. But the problem has now been resolved.

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In Georgia the foreclosure situation is grim with one out of every eight mortgages being affected. Budget cuts have further aggravated matters. The resources that the state had for helping the victims are now shrinking. Most of the staff so far employed in handling mortgage problems has been given marching orders. Now there is only one full timer working against the clock to handle the innumerable complaints. The state with a budget deficit of $2 billion did not have any other option but to take this drastic step.

Hitherto there were four persons employed in the Department of Banking and Finance. Their job was to guide the complainer through the formalities of the process, review relevant documents, forward any sort of information that was required to the various regulatory departments and work in general to resolve the issue, said Judy Newburry, the Deputy Commissioner for Legal and Consumer Affairs.

The one single staff member cannot possible perform all these functions. He is able to give out a list of help that can be availed of from outside. By doing so – fraudsters are seeing big opportunities to chip in. 500 mortgage complaints were noted in 2007 according to the department. It is not sure how many are getting help today since complaints are no longer tracked.

It has been the worst time for such a thing to happen. Foreclosures are increasing and more people are in need of help. Fraud too is increasing. The federal government has initiated a programme involving $75 billion to address the foreclosure problem by modifying and refinancing loans. Attorney General Eric Holder said that in April the FBI took charge of huge numbers of fraud cases – 400% higher than in the previous five years.

Other states have been keeping pace with the surging tide of foreclosures by increasing their help programmes. Arizona launched a help line in 2008. Nevada, Colorado and Michigan have all set up hotlines for the foreclosure victims to ask for assistance and report cases of fraud. Florida’s hotline has been flooded with complaints in 2008. An operator on the hotline in Florida noted “Caller is very upset and crying. Caller says that Wells Fargo did not turn her over to a collection agency. Wells Fargo told her that this is theft and to make sure we know about it.” The caller had said that she had paid $1,000 to someone who claimed to be a collector of debts!

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In the Columbus Dispatch we found a story about how a county there helped 78 homeowners avoid foreclosure and stay in the homes that they owned. The homeowners and the bankers came together face to face to work out deals to stem the foreclosures and make it possible for the families to remain in their homes. Interest rates have been cut for these people and the terms or length of the loans have been stretched out in many cases to make the payments lower so that they can be made more easily and this seems to have made a large impact on theses people.

The New York Times brings us the story of a Connecticut family that fell behind on their mortgage without even knowing it. This happened because the amount of the mortgage, $2,500 per month, was automatically adjusted from their credit union. But when the rate of the mortgage got re-adjusted from 8.3 percent to 12.5 percent, they were not aware of the increase of $1,000 more per month. The automatic withdrawal payments from the credit union did not increase so each month they fell $1,000 farther in arrears on the mortgage to the point that they were almost not able to stay out of foreclosure. These people, like many others have stated that if they didn’t have children, they would most likely just walk away from the loan.

In Ann Arbor, Michigan homeowners are struggling with upside down, or underwater mortgages. This means that they owe much more on the house they are buying than it is worth and as a result they are in a severe negative equity situation. What makes this so bad is that even if these people are able to make the current mortgage payments, they can’t refinance at lower rates because the house will not appraise with enough equity to allow a lender to give them a new mortgage. So even though they are doing everything right, they are getting the bad end of the deal because most places available now are for people that are unable to make the mortgage payments and those that are keeping up are getting, in a way, chastised for it.

Here is another touching story from the Columbus Dispatch this week. Folks that own mobile homes are feeling the pinch of the mortgage foreclosure crunch in an unusual way. Even if they own the mobile home outright and are keeping up the lot payments, if the mobile home park has problems and goes into foreclosure, the people that live there have to find a new place to move the mobile homes to. This can be a considerable expense that is not their doing. The Ohio legislature has passed a bill telling the people that own the land that they need to notify the tenants within 60 days and then the mobile home owner has an additional 30 days to vacate. Considering that most of these people are on substandard incomes and the cost of moving, it is going to be a hardship that few can sustain.

While this is not directly foreclosure related it is worthy of including here. Since the government has been unable to stop the job loss and the foreclosure numbers, they are giving some hope and reason for optimism to the voting public by banning arbitrary rate hikes and the excessive fees being charged by credit card companies. This may help to stem the fear that these already cash-strapped families are suffering from and allow them more breathing room in the budget thereby making it easier to handle the mortgage. One of the key parts is that a customer would have to be over 60 days behind in the payment to be able to get a rate increase.

This story is one of someone buying properties, which she was going to use as retirement income. She turned three of them into section 8 housing, which the government subsidies. The problem is that under the law when someone in one of these low rent properties complains and an inspection is made, the landlord has to fix the problem. This more often than not cost here money every month instead of making her income. It got so bad that she finally decide to let the three properties go into foreclosure. This meant that she was free of the burden but it also meant that three families were put out and had to find another place to live.

When considering a repayment plan or a mortgage modification plan. Which is the best option for a homeowner in mortgage distress? This question is addressed in detail in this article. The repayment plan almost is never the best option because in addition the regular mortgage, the already troubled homeowner has to pay an additional sum to cover back payments. The modification plan however is just as the name says; it modifies the existing terms to something both parties can benefit from.

From NBC local affiliate News 2 In North Carolina we get the story of an FTC website that is there to help homeowners sift through the many scams that have come into existence since the mortgage crunch. These scams are set up to help trick an already desperate homeowner out of money. The federal government has started to address the issues and this website that they set up helps to address these concerns and give people information that might help keep them from becoming a victim.

The Huntington News story tells that quotes Jay Rockefeller in saying that “I applaud President Obama for signing both the Helping Families Save Their Homes Act and the Fraud Enforcement and Recovery Act into law.” The article states that he feels that there are many issues that have to be addressed from credit card companies to mortgage companies and that this will go a long way towards putting the and that this is a great start put people first and to helping the American people come to terms with this crisis.

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Despite the various governmental and other measures foreclosures continue to surge in February 2009. It is a spike of 30% from what it was in the same month in 2008.

Lenders too have imposed moratoriums on foreclosures but this does not seem to have reduced the number of foreclosure postings. The number of borrowers facing foreclosure increased by 30% from the levels of the previous year according to RealtyTrac.

Across the country about 291,000 units received at least one notice related to the foreclosure process. It showed an increase of 6% from January this year. Foreclosures are highly concentrated in two states – Florida and California. It is also spreading to other states like Idaho, Illinois as well as Oregon as the economy of USA continues to slide. Rich Sharga of ReatlyTrac said, “It doesn’t bode well. At least for the foreseeable future, it’s going to continue to be pretty ugly.”

Foreclosures have spiked although mortgage giants like Fannie Mae and Freddie Mac as well as other jumbo banks like JPMorgan Chase, Morgan Stanley, Citigroup and also Bank of America have temporarily halted foreclosure proceedings. They did so ahead of President Obama’s release of ambitious plans to tackle the foreclosure crisis that was launched recently. In New York and Florida the temporary hold on foreclosures have been lifted and this has caused numbers to rise sharply. Other states like Michigan are enacting legislation to allow for borrowers facing foreclosure to enjoy a grace period of 90 days to get their finances stabilized.

While foreclosures march on, the banks have stopped including their repossessed properties in sales list for the time being. RealtyTrac noted that there were about 700,000 bank-repossessed units across the country resulting in a “shadow inventory.” This could cause the housing crisis to drag on for more time than anticipated. Rick Sharga commented, “It’s going to take us longer than you might anticipate to burn through he inventory of distressed properties.”

The results show up the challenges that Obama and his economic advisors are facing. The Obama plan is targeting help to 9 million homeowners. It is hoped that they will continue to stay in their homes after refinancing or modifying their loans.

But the foreclosure contagion is spreading. About 12% of those with mortgages in America counting to 5.4 million are at least a month behind in their mortgage payments as per the findings of Mortgage Bankers Association.

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Florida Supreme Court is overburdened with foreclosure cases and is calling for 68 new judges to manage the pile. The cases also relate to increasing criminal activities arising from abandoned foreclosed units. The Supreme Court made this report to the Legislature. The request is for additional 29 circuit judges and 39 county judges. No new appellate judges were asked for.

Peggy Quince also requested the legislators not to further make cuts on strength of the staff. She noted that the legislators have reduced the staff by 301 during the last year and the current budget year although the number of cases has gone up. The bulk of the cases (396%) deal with foreclosures for two years ending 30th June 2008.

The legislators have greatly reduced the budget of the state because of sharp drops in tax collections. Quince said in writing, “This court acknowledges that our state and our nation are experiencing an unparalleled economic crisis. Nonetheless, there comes a time when making necessary adjustments in order to sustain budget reductions cascades into crippling the daily operations of an entire branch of government.”

Despite these constraints the legislators agreed that funding of the courts has to be maintained. No additional cuts were initiated in the judicial system. Additional funds were created on the other hand through increase of traffic fines and allowing judges to impose criminal fines even while withholding adjudication of the guilt.

The demand for additional judges was founded on a study that considered not only volume of cases but also the complexity of the suits and the time judges required to deal with them. Victor Crist (Republican – Tampa) said, “ We’re going to take this information into consideration. We’re going to take it very seriously.”

The approval of additional judges will depend on the availability of funds explained Crist. If it was insufficient then the request would have to be kept pending for the following year. It was also noted by him that the number of cases had dropped since the completion of the study and perhaps the situation was getting corrected by itself.

The legislature has a Republican majority. So far it has resisted from taking steps to increase taxes to supplement loss of revenue.

Governor Charlie Crist (Republican) is another individual and not the same as the senator of the same name. He has suggested a budget that would initiate fewer cuts for the following fiscal year that starts off from 1st July. It would be possible to do this by relying heavily on federal grants and also by expanding gambling at Seminole Indian casinos.

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Despite the stimulus rolling in, Florida is facing budget crunches and the situation is grim. Although there have been cuts in property taxes, changes in insurance rules as well as foreclosure relief attempts, it is a tough job for budget writers. The boom years have receded to a foggy past.

On Tuesday 3rd March the lawmakers will start the legislative session (60 days) with the prime task of trying to find ways to pay bills for the services rendered by the government with less number of dollars.

The options before them are severe. Spending on education, health-care as well as transportation would have to cut by $8 billion. The funds coming in from the federal stimulus could only work out a temporary quick fix. The other alternative would be to increase taxes on various items like alcoholic drinks, cigarettes, Internet vendors, motorists as well as companies that deal with bottled water. The immediate current deficit is about $700 million. Within a span of two years this would be the seventh recurring budget cut.

In the forthcoming year starting from 1st July, the situation is worse for Florida with the gap exceeding $5 billion. The frustration is visible in the Capitol. The revenue collected for December 2008 and January 2009 was $216 million less than what was expected. Steve Wise (Republican) chairperson of Senate PreK-12 Education Appropriations said, “When we come out with a budget, it’s going to be a disaster and everybody’s going to be not happy.”

Governor Charlie Crist is offering a bagful of federal money to stimulate the flagging mood of the economy. His department plans to plug the deficit hole for the next 16 months with $8 billion from the $787 billion that has been granted by the Congress. Crist explained that since the state was passing through a critical time the money is much needed. According to his plans over $3 billion would see through the following four months. $4.7 billion would make patchwork repair to the damage done to education, health care and transportation. It would lead to a balance of $3.8 billion as Florida’s share of the stimulus grant for the fiscal year of 2010-2011. This will hardly cause the economy of Florida to star to recover.

However certain vital categories like health, education and transport would get some reprieve. This would be of help to the poor, the seniors and those who are disabled or caring for foster children.

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The scene in courthouses is awesome – the courts are staggering under the weight of foreclosure cases.

Lee County courtroom depicts a typical scene. The judge asks the defendant if he or she is current in mortgage payment. The answer is invariably negative. Next the judge wants to know if the accused is living on the said property and here in most cases the answer this time is in the affirmative. The judge then gives a typical reply that the file has been reviewed and summary judgment will be granted. The defendant will be awarded a copy and also some extra time – about 60 days until the unit is sold. The brief speech ends with thanks. The whole drama takes 18 seconds. The homeowner has played his or her part and lost the game in 18 seconds. The answer is routine – pay up or get out.

Rachelle Hanleck was lucky to get a full minute in the court. She was lagging behind for twelve months and was hopeful of getting a sympathetic hearing. Sobbing she tried to explain that she was a teacher belonging to a migrant community.” But to the court she was nothing more than a number. Nobody had the time or patience with her tears. Her lender has refused to refinance the loan. She has no alternative but to move out.

Lee County court is clogged with backlogs of over 24,000 foreclosure cases. Charlie Green the clerk at the county civil court felt that it was high time some cleaning up was done. He informed that this was being done.

On that particular morning 450 foreclosure cases were heard. Only 47 foreclosure victims appeared at court. Most of them will have their houses put up for auction in the next two months.

CBS News correspondent Michelle Miller reports that Philadelphia City has taken a dissimilar stand in tackling the foreclosure problem. In courtroom 676 the traditional rules of the courthouse have been set aside. New deals are being worked out between the two contenders – the borrowers and lenders. Lisa Lee representing mortgage companies opined that the two have more in common than they know. The lenders of today do not want to be saddled with more foreclosures. It is a loss to them to be saddled with real estate inventory. This is something borrowers want to hear. The judges are working with the attorneys to make this reality come true and bring about a halt to foreclosures. Five other cities are duplicating this plan.

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Lehigh Acres was one of the worst affected regions in Florida because it was dependent on construction. The first sign of trouble was garage sales and property auctions in Lehigh Acres. The families began selling off whatever they could just to survive. But there were few takers for houses and soon the place came to be dotted with vacant foreclosed houses. These became centres of crime and disease.

Thieves ripped off everything they could take and drug peddlers moved in on Prospect Avenue. In a year from 2007 to 2008 the Sheriff closed down over 100 houses where marijuana was being cultivated. 3,000 marijuana plants worth about $7 million were confiscated by the police.

In the winter of 2008 the Director of Lehigh Community Services, Charlotte Rae Nicely began to notice an increase in the number of hungry people. She ran a food pantry in a small office park. Demand started to grow and many new faces popped up coming here every week. On the other hand there was an exodus of residents.

Nicely decided to form a group to find out how the other agencies were faring and if they could coordinate their movements. This was the first step Lehigh Acres took in fighting the problem in an organized manner. The group termed itself Team Rescue. Meetings started to be held per month. The group now includes about six churches, some non-profit groups, businessmen, and county government representatives including the Sheriff’s office.

The discussions centred around the problems that followed on the heels of foreclosure and unemployment. These issues were something new in American society. On top of the agenda was Hunger! The organizations have noted an increase of 75% in demand for food. The people asking to be fed are not those who are chronically poor.

The help seekers in front of the Lutheran Church are a mixed lot comprising of people of all ages and previous income slabs. Luis Oquendo (38) comes regularly for his bread quota since the fall of 2008. His job as a construction worker has vanished. Fred Csifortos is a retiree and living on $650 per month coming from disability funds. He uses the money left over from food for his medical care. Megan Brown turned up with her smartly dressed daughters aged 2 and 4. Her husband still has a job but fearing the worst she is preparing herself for the downpour.

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When Peter was asked what role these exotic mortgages played in the foreclosure crisis of today he promptly replied, “They were essential. They were necessary. Without the Alt A or option ARM mortgage, this boom never would’ve occurred.” Nothing could be more true. Without these fancy super mortgages many of the borrowers would never have qualified for a mortgage loan. The lenders and brokers took their share of fees and commissions and were eager to ink more loans. What happened to the borrowers and the nation later on was none of their concern. The killers did not bother to check if the income was real or not. They agreed to ‘liar loans’ where no down payment was required. Jokingly these were termed ‘ninja loans’ – no income, no jobs and no assets. Just a pulse was sufficient for a loan to be sanctioned.

The key reasoning behind this mad behaviour was the belief that the price of houses would go on increasing. It was a fact that since the Great Depression real estate curve had steadily kept going upwards – it was a steady progress.
People had a heady feeling of climbing up the socio-economic ladder in leaps and bounds. Rula Giosmas was an acupuncturist. Soon she became a real estate speculator investing in six properties paying only 20% down on each being financed by option ARM. Today she is being foreclosed upon and losing on each unit.

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ForeclosureListings.com has a comprehensive, searchable database of foreclosures in areas like Columbus, Bronx, Derry, Missoula and in the whole country. Try to search foreclosures by state today! Condo Vultures Are Busy Picking Up Tasty Morsels Of Foreclosed Properties