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Foreclosure Filings Soar 121 Percent

posted: 14 DAYS 13 HOURS AGO

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NEW YORK (July 25) -- Foreclosures continue to soar, with 220,000 homes lost to bank repossessions in the second quarter of this year, according to the latest statistics from RealtyTrac, an online marketer of foreclosed homes. That's nearly triple the number from the same period in 2007.

There were a total of 739,714 foreclosure filings recorded during that three month period, up 14% from the first quarter, and up a whopping 121% from the same period in 2007. That means that out of every 171 U.S. households received a filing, which include notices of default, auction sale notices and bank repossessions.

"Most areas of the country are seeing at least some increase in foreclosure activity," said RealtyTrac CEO James Saccadic. "Forty-eight of 50 states and 95 out of the nation's 100 largest metro areas experienced year-over-year increases in foreclosure activity."

Because foreclosure filings are growing so quickly, RealtyTrac will have to reevaluate its foreclosure forecast for the year, according to spokesman Rick Sharga.

"We've been saying foreclosures will total 1.9 million to 2 million this year," he said. "But midway through the year, we're already at 1.4 million so we're going to be raising our projections."

And there is more bad news: Bank repossessions are up as a proportion of total filings, representing 30% of the notices issued during the quarter, up from 24% a year ago.

"I don't think that's a surprise if you look at the general conditions out there," said Brian Bethune, chief financial economist for Global Insight. "There have been six straight moves of weaker employment this year. The ongoing problems in the housing market are compounded by a generally weaker economy. Foreclosures won't go down until we start to see employment move up again."

Sun Belt front and center

California's Central Valley remains ground zero for foreclosure filings. Stockton, which is just east of San Francisco, had the highest rate of foreclosure filings of any metro area, one for every 25 homes. That's seven times the national average.

Riverside/San Bernardino, which is east of Los Angeles, had the second highest rate in the nation with one filing for every 32 households. Las Vegas, Bakersfield and Sacramento rounded out the top five.

Detroit continued to suffer more than any other non-Sun Belt area, with one filing for every 66 households. And several Ohio cities were also hard hit, led by Toledo (one in 92 households), Akron (one in 93) and Cleveland (one in 108).

On the other hand, there were a handful of metro areas that remained relatively unscathed. Honolulu, at one filing for every 1,331 households had the lowest rate of all, followed by Allentown, Penn. (one for every 972) and Syracuse, NY (one for every 880).

At the state level, Nevada had the highest rate with one filing for every 43 households, while California had the highest total number of filings - 202,599.

The report came as more negative news for the housing market this week. On Thursday, a report form the National Association of Realtors revealed that existing home sales had declined again as the number of homes for sale continued to rise. On Tuesday, a government agency reported home prices registered another drop in May.

All this is happening as Congress struggles to pass a housing rescue bill that will make FHA-insured loans available to many at-risk borrowers. That bill, even if signed this week, will not take effect until October.

One of the sponsors of the bill, Barney Frank (D -- Mass.), released a statement on Thursday in which he encourages lenders and mortgage servicers to delay taking action against delinquent borrowers before the new law takes effect.

"I am urging the mortgage servicers to hold off on foreclosures in applicable cases," he said, "so borrowers can take advantage of the program."

2008-07-25 06:20:25

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58 comments

Linda inMO 08:07:05 AM Aug 10 2008

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CMountainDave states "Banks short sell foreclosures at a 30% discount. " I wish someone would tell the Banks in St Louis MO this information...as they are turning down offers at 17%

Gkgdeals 12:39:27 PM Aug 06 2008

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Loan Modifications can stop foreclosure. It's also alotcheaper than a refinance. My friend works for www.lendermodification dot com and says that he is helpinglot's of people.

Gkgdeals 12:38:36 PM Aug 06 2008

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Loan Modifications can stop foreclosure. It's also alotcheaper than a refinance. My friend works for *** www.LenderModification.com *** and says that he is helpinglot's of people.

Rowellfoxworth 02:00:28 AM Jul 28 2008

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its not just folks that made bad loans. It is people that were paying their notes, but living pay check to paycheck to do it. Now that food, gas, power, everything has risen the money people paid their notes with is going to gas to get to work to buy food.

Lindeberg 07:42:23 AM Jul 27 2008

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I had a friend who took his life before they took his house!

Jagarch53 09:30:16 PM Jul 26 2008

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Our house values are going down; interest on credits is going up. We as American have to find ways to go around the financial crisis that we are in. Before we had no solution, as we had no effective tools to increase our house value. By adding income value to ones real estate, one can earn decent raise in his house value. The use of ones property as a lodging, as a ware house, a gallery or as a plug-in-station can enhance the value of ones house value. Besides the income that these small businesses generate can be very helpful to reduce debt burden, improve the standard of living. Of course there are franchise offering companies, contracts with them can shoot up the house value, but is at a very high cost beyond the reach of most of the people. Now it is possible instant infrastructure and tools that allows one to start lodging, storefront, gallery and even new services called plug-in electric station powered from solar roof tops. The platforms empower to solve the crisis by ourselve

LRusso4TC 07:33:22 PM Jul 25 2008

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IS PRESIDENT GOOBER STILL TRYING TO HELP THE BANKS THAT STUCK IT TO THESE HOMEOWNERS ISTEAD OF THE HOME OWNERS AS FOR COMMENTS ON AFFIRMITIVE ACTION FUNNY CONVERSATION I HAD WITH SPOKES PERSON FOR NAACP ABOUT DISCRIMINATION FOR MINORITIES BUT THAT'S NOW BUT DID NOT HEAR A WORD WHEN BANKS MTG CO. GIVING OUT MTG. NILLY WILLY BECAUSE I'M GOING TO FILE SUIT GOING TO GET REV AL TO MARCH ON YOU CAUSE YOUR DISCRIMINATING. WELL WONDER WHAT PERCENTAGE OF THOSE LOANS WHERE MADE AND HOMES LOST TO PEOPLE WHO SHOULD HAVE BEEN DICRIMIATED BECAUSE OF POOR CREDIT LACK OF DOWNPAYMENT OR HEAVY DEBT THEY NOW WISH THEY WHERE DISCRIMINATED.LR CHAS. SC

Yakami1 07:26:40 PM Jul 25 2008

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Going rate say 7.00. at O discount. Purchaser wants 6.00 for 30 years fixed. The cost at 6.00 is 1% of loan to buy down the rate. As incentive builder agress to pay down the rate for borrower to 6%. Everyone happy. But in this the sub pime quoted to get 0 discount with credit risk 9.00% for 30 years oir maybe some arm that adjusts to make up the fee later in about 3 to 5 years. Who i sbeing cheated when the Gov comes back and reduces the prime market and the regular borrower paid the full price up front? I doidnlt think they would be giving free reducetions that would normally cost to get.

DWUZZIE 06:57:11 PM Jul 25 2008

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An2Anders 03:56:16 PM Jul 25 2008 Report This! Who cares just a R E bull market correction. If Congress keeps its hands off the correction will bottom in 2010/11, if not it will take 10 years and us workjing taxpayers will foot the bill for their mess and interference. NOTE that , all this gloom and doom started two years ago after the DEMORATS,led by Pelosi and \Reed took over Congress.LOOK at the mess they have made in 2 short years !!!!!......................................................................................................................... One of their first orders of business was to add 2 Trillion to the national debt cieling to pay for the republicans folly of 2000-2007 and the mess keeps rolling