This upcoming year is unlikely to be a good one for the housing market. There are many reasons for this conclusion. Yesterday, in a blog post I discussed the inevitable drop in the values of homes in 2011. This article, I want to talk about what seems like another 2011 inevitability: a rise in foreclosure activity.
RealityTrac, a data provider, reported that the amount of foreclosed houses went down in November. There were 262,000 foreclosure notices issued, down 21% from the month before and down 14% from the same time in 2009. Sadly, this was the first time in 21 months that foreclosure notices fell below 300,000. On the face of it, this seems like a good thing. However, the steep decline can be directly credited to foreclosure moratoriums given out by major mortgage lenders because of the unbelievably unorganized paperwork that resulted in the robo-signing situation that has yet to be settled. The decline in the number of foreclosures simply could be considered a stall tactic for many people who are stuck in dire financial straights.
RealtyTrac Senior VP Rick Sharga commented:
“In the first quarter, we really anticipate seeing a pretty rapid acceleration of foreclosure proceedings as everybody catches up.”
All the lenders that suspended their foreclosures have since “evaluated” their processes and paperwork and appear to be set to continue foreclosures. According to an article by Reuters from December 15th, Bank of America intends to raise foreclosure filings this year. The President of Bank of America’s home loans division, Barbara Dosoer, stated:
“We feel comfortable with the results we’re getting, so starting in January you will see a ramp-up [in foreclosures].”
The government’s foreclosure prevention programs are not helping either. Most notably, the Home Affordable Modification Program (HAMP) government’s most discussed program attempting to prevent foreclosures, has been openly criticize by the press and by government watchdogs such as the Congressional Oversight Panel for being fundamentally “ineffective”. The redefault rate on loans modified by HAMP is sitting at 21%, furthermore, the U.S. Treasury itself estimates that the rate could possibly increase to 40 percent or more when it is all said and done. View Full Article.
Total Mortgage Services, LLC is an industry leading mortgage broker and lender headquartered in Milford, Connecticut. Thanks to the trust of thousands of customers from all around the county, Total Mortgage has continued to grow by stressing personal service and rapid responses, and has funded over $6 billion in mortgage loans and are licensed in 21 states.