OK, if I am reading this correcly they are stating the delinquency rates peaked a year ago in the first quarter of 2010. Maybe that has something to do with the fact that a year ago they started approving short sales in greater quantity. As a matter of fact, by the end of the 2010 Short Sales were being approved at 4 – 5 times the rate of year earlier.
The answer to the financial meltdown is to approve Short Sales and stop the foreclosures. That was the message executives from Wells Fargo, Bank of America and Chase brought to the valley in separate meetings over the past 6 months.
There are still too many people in trouble. Forclosures will continue but as more turn to Short Sale and Short Sales get approved more quickly and with no recourse, then the market will begin to recover. The last thing I want to see is it taking another 5 years to get out of this mess. And I don’t believe it will take that long.
Back to the banks. They met with top Short Sale agents here in the valley and brought this message:
1. We prefer Short Sale over Foreclosure. We are staffed up and ready to give you better service. (Making fun of their service)
2. Hardship = approved Short Sale.
3. 70% of people that foreclose don’t talk to their bank or a Realtor. Get the word out!
4. No longer will foreclosure extensions be given without a clear Short Sale approval or extreme reasoning.
5. Loan modifications are a JOKE. Well, they didn’t use that word.
MY OPINION, Short Sales will catch up with Foreclosures by the end of the year. Qualified Short Sellers will get approvals in less than a month or be pre-approved by summer. Prices will stop falling. Our real estate market will see price appreciation in 2012. Let’s see!
NEW YORK – Fewer Americans fell behind on their mortgage payments in the final three months of last year, but foreclosures are still rising. by JANNA HERRON – Feb. 17, 2011 09:00 AM AP Real Estate Writer
The Mortgage Bankers Association said Thursday 8.2 percent of homeowners missed at least one mortgage payment in the October-December quarter. The figure, which is adjusted for seasonal factors, improved from 9.1 percent in the previous quarter and from a high of more than 10 percent in the January-March quarter.
The percentage of homes in the foreclosure process rose to 4.6 percent from 4.4 percent, tying an all-time high for the survey. Foreclosures are expected to peak this year as 5 million troubled loans move through the process.
Typically, the percentage of seriously delinquent borrowers – those more than 90 days behind on their mortgages or in foreclosure – is just above 1 percent. In the fourth quarter, that figure was 8.57 percent.
An improving job market is behind the decline in the delinquency rate, said MBA Chief Economist Jay Brinkmann. He noted that the private sector added 1.2 million jobs last year and the number of people applying for unemployment benefits started to fall in the fourth quarter.
“It’s a sign we’ve turned a corner, that’s the good news,” Brinkmann said. “The bad news is loans in foreclosure are still very high.”
Foreclosures dipped in the July-September quarter as lenders addressed allegations of improper paperwork during the foreclosure process. But by the final three months of last year, many had resumed taking back homes.
Banks are on track to repossess more than 1 million homes this year, the most since the housing meltdown began, according to foreclosure tracker RealtyTrac Inc. That will drive home prices down because foreclosures are sold at deep discounts.
The foreclosure crisis started years ago when borrowers took out risky loans with adjustable interest rates that they couldn’t afford. Many also qualified for loans without providing proof of income. The crisis spread to homeowners with good credit who took out safe, fixed-rate mortgages, but are struggling in a weak economy.
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