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Foreclosures jump 30 percent in 3rd quarter
By Editor | November 4, 2007
Congress, White House debate solutions to help people keep their homes
By John W. Schoen
As Congress and the White House continue to work toward solutions to help embattled homeowners, home foreclosure filings took a big jump in the third quarter, according to the latest data from real estate Web site RealtyTrac.
Foreclosure actions were reported on more than 446,000 properties the three months ended Sept. 30, up 30 percent from the second quarter and double last year’s third quarter. That brings the overall foreclosure rate to one in every 196 U.S. households.
The rise in foreclosures was widespread, with 45 out of the 50 states reporting higher levels than last year. But the highest concentrations were a handful of housing markets; California Arizona, Florida, Nevada, Ohio, Texas and Michigan made up more than half of the total.
he rise in foreclosures comes as millions of homeowners face sharp increases in their mortgage payments from low “teaser” rates as the housing market remains mired in a slump.
Home prices in 10 markets tracked by the S&P/Case-Shiller housing index slid 5 percent in August, the eighth straight monthly drop, according to figures released Tuesday. Some economists expect home prices to fall by 10 percent before the market finds a bottom sometime late next year, barring a further economic downturn. The pullback follows one of the strongest housing booms on record that sent median prices up more than 50 percent earlier in the decade.
Because the low initial rates on many mortgages typically last for two or three years, the housing market faces further pressure next year from loans that were written when the housing market was still rising and lenders were offering easy terms to borrowers with less-than-stellar credit.
“Given the number of loans due to reset through the middle of 2008, and the continuing weakness in home sales, we would expect foreclosure activity to remain high and even increase over the next year in many markets,” said James J. Saccacio, chief executive officer of RealtyTrac
In Nevada, there was one foreclosure filing for every 61 households, the highest rate in the nation. That’s up 23 percent from the previous quarter and more than triple the number reported in the third quarter of 2006.
California saw one filing for every 88 households, the second highest; the rate was up 36 percent from the previous quarter and nearly quadruple the third quarter of 2006.
Florida’s foreclosure rate, the nation’s third highest, rose from a year ago to one filing for every 95 households, an increase of more than 50 percent from the previous quarter.
Other states with foreclosure rates among the top 10 included Michigan, Ohio, Colorado, Arizona, Georgia, Indiana and Texas.
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