Foreclosure Recap – Week #17

What an active week it has been in the real estate and foreclosure market in the United States. The most interesting news may well help some folks out of the financial bind that they are currently in. The Federal government announced that they plan to offer a “Second Lien Program” to help folks cope with the second mortgage they may have on their homes. The Obama administration announced this as part of the “Making Homes Affordable” program, where it plans to offer a 1% rate on the second mortgage to help stave off the foreclosures. Almost 50% of homeowners facing foreclosure today are in that position due to the second lien on their property.

The administration actually has so many different ways to attack the problem that it can be confusing to understand at first. For that reason, you may wish to decode all the issues and see exactly what is going on. Many people actually think that under the new initiatives, if the borrower refinances, it will replace the amount that he owes. The truth of the matter is that refinancing merely reduces the interest rate on the principal that is owed on the original loan.

As more and more Americans face foreclosure, they are struggling to answer basic questions. Sometimes these questions can be more frightening than the reality. For that reason, people are attempting to learn as much as they can about the current foreclosure system and the options available to help prevent it. Since foreclosure can and will have a negative impact on a persons financial status, it is recommended that anyone that owns property find out exactly what a foreclosure is and become familiar with the process.

According to the New York Times, the city of Phoenix leads the nation as the first city in America to have home values fall more than 50 percent. The value of homes has fallen a staggering 50.8 percent since the peak in June, 2006. During the first quarter of the year, foreclosure notices were filed on one in every forty houses in the Phoenix metro area. Those numbers are not isolated as several other large U.S. cities are also nearing the 50 percent mark. Las Vegas, for example, is currently at 48 percent. Large Canadian and Chinese firms are coming in with huge stockpiles of money and buying houses by the hundreds to capitalize on the problem.

The market, according to Fox News, is not as bad in the Memphis and Nashville areas. In a recent story, they say that the local area has a large amount of homes and they have been selling them off at a public auction. The hope is that it will help to stimulate the local economy and real estate market.

According to the Property Show Rooms web site, the top 26 cities on the foreclosure rate list are concentrated in only 4 states: California, Nevada, Florida and Arizona. These are the states that are having the toughest time in stabilizing. The Obama administration said that the recession will continue to affect the markets there and that people should expect more foreclosures before things get better.

The Baltimore Sun quotes the Los Angeles Times in reporting that more and more Americans are considering bankruptcy to help them escape the problems they are in today. It certainly can help you get a fresh start in life by eliminating debt, but if you are looking at this as an option, you could end up in a lot worse shape than you are right now.

The state of Texas is taking some affinitive action to help people in foreclosure state. The article tells all about what the Texas legislature is trying to do. In short, it will allow folks facing foreclosure more time to figure things out as well as an extended period of time to vacate the property once foreclosed. So instead of having 20 days to resolve a delinquent mortgage, Texans now have 45 days plus a full fourteen days to vacate.

Property in New York, according to the folks is at an all time low. One example is a bowling alley complex in North Tonawanda which is appraised at over $700,000.00 and was recently purchased by a company for an astonishing $185,000.00. This gives you an idea of how far things have fallen, even on the east coast.

According to the IB Times, the existing housing market slid downwards again in March by another 3 plus percentage points. This is driven primarily by the foreclosure rate being so high and people just not being able to make ends meet. And, this is the fifth straight month that the numbers have fallen in larger amounts.

More and more people are turning to extreme measures to deal with the lack of control in the foreclosure arena. The Baltimore Sun Times ran a story of how a father / husband killed his wife, three young children and then blew his own head off with a shotgun because he could not dig the family out of debt. They were over $460,000 dollars in debt and had two homes, one in Florida in foreclosure. He left notes telling of his deepening depression and then dealt with matters the only way he could see to do so.

Even historic locations are not immune to the foreclosures running rampant in the country today. If you go to the article and review the story, it tells of a famous hotel and casino located on the north shore of Lake Tahoe which was once owned by singer Frank Sinatra. The lack of event-related business has been blamed for the lack of revenue that caused this landmarks foreclosure.

The Miami Herald has reported that the local courts there will soon be requiring that lenders and borrowers try to mediate the foreclosures out of court to help ease the backlog of cases and attempt to help save the buyers homes. The general consensus is that if the two opposing parties sit down and try and work out a compromise, they will arrive at a more amicable solution than letting the courts decide the fate of the property. As a result, more homeowners may be able to avoid foreclosure all together.

This is your foreclosure recap with Kevin Simpson. See you next week!