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RealtyTrac Reports 2.8 Million Foreclosures In 2009, "Would Have Been Worse If Not For Delays In Processing Delinquent Loans"
RealtyTrac reported its December foreclosure number which came in at 349,519, a 14% jump from the previous month, and a 15% increase from December 2008, and an end to the favorable declining monthly trends July. And according to Rick Sharga, SVP of RealtyTrac, 2010 is expected to see between 3 and 3.5 million foreclosures, which will be another record. Some recovery.
RealtyTrac, today released its Year-End 2009 Foreclosure Market Report™, which shows a total of 3,957,643 foreclosure filings — default notices, scheduled foreclosure auctions and bank repossessions — were reported on 2,824,674 U.S. properties in 2009, a 21 percent increase in total properties from 2008 and a 120 percent increase in total properties from 2007. The report also shows that 2.21 percent of all U.S. housing units (one in 45) received at least one foreclosure filing during the year, up from 1.84 percent in 2008, 1.03 percent in 2007 and 0.58 percent in 2006.
Foreclosure filings were reported on 349,519 U.S. properties in December, a 14 percent jump from the previous month and a 15 percent increase from December 2008 — when a similar monthly jump in foreclosure activity occurred. Despite the increase in December, foreclosure activity in the fourth quarter decreased 7 percent from the third quarter, although it was still up 18 percent from the fourth quarter of 2008.
“As bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans,” said James J. Saccacio, chief executive officer of RealtyTrac. “After peaking in July with over 361,000 homes receiving a foreclosure notice, we saw four straight monthly decreases driven primarily by short-term factors: trial loan modifications, state legislation extending the foreclosure process and an overwhelming volume of inventory clogging the foreclosure pipeline.
“Despite all the delays, foreclosure activity still hit a record high for our report in 2009, capped off by a substantial increase in December,” Saccacio continued. “In the long term a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond as lenders gradually work their way through the backlog.”
Extend and pretend will continue with less of a marginal impact as more and more of the shadow inventory, which according to Jim Cramer is irrelevant, comes to market.
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Kick... The... Can.
This is some world-class recovery we got goin' on 'round here, no?
I'd give it a B+
Solid. As a rock.
please help ..need some answers...
What happens to a home that has been pooled into a box of mortagages. Which bank gets it? Is it the last bank? And what if the bank is in China?
Secondly, is iot theoritically possible that a bank profits more,when a house is foreclosed on?
Thanks in advance
Nothing material happens when a loan is pooled. It just means that it has been grouped with a number of like loans, by whatever parameter.
Usually it is Fannie or Freddie that purchases the pool of loans, but there are others out there too. As to who services the loan, I'm not sure why they pick one servicer over another except perhaps a bid process. It is almost immaterial who actually owns the loan (Chinese company), except for the losses ha, but more pertinent to the resident is who services the note. One thing that the owner of the note does effect, however, is whether they are party to doing modifications or not, if not it's tough tiddles.
Theoretically I would say it is not more profitable for a bank to foreclose. In fact you may have heard stories of people mailing in keys but the banks refusing to foreclose, even months and years later, leaving the property in limbo with tax issues arising. I have heard of schemes between banks to sell each other foreclosed properties, but that's not exactly profitable in the long run. I think foreclosures are more a valuation issue. As long as a loan doesn't foreclose (and get sold subsequently at a much lower $ amount), get modified, or get short sold; well then with current accounting laws the owners can say the house is still at bubble value on their balance sheet.
I am a peon at a TBTF mortgage servicing call center btw.
Hope that helps a little.
I would add that the likely result of it being pooled is that you have a greatly increased chane of retaining your house if you default on your loan
I'm hearing lots of anecdotes of families who are challenging their mortgage default in court, and the banks lawyers seem unable to provide evidence to demonstrate that they actually have the right to take the house. judges are knocking down these cases in favour of the little guy
bluff those bloodsuckers until your prospects and options improve. good luck to ya.
Extend and pretend...
Delay and pray.
DavidC
Post time series foreclosure heat maps please. Brain needs caffeine to face the facts.
Of course the foreclosures will continue...with unemployment continuing to rise, who has money to pay the mortgage?
Frankly,with no ecnomic plan to put people back to work,I don't even know why should be a recovery. And to put people back to work,you need to have competitive labor cost with the emerging market. So either protectionism,or deflating wages and other health and administrative cost.
The foreclosure number might be lower than they think for 2010 - because of short sales, which are a bit better for the economy, but still represent a loss for the owner of the mortgage (and usually a total wipeout of the second lien holder).
So watch for that in any reports of foreclosures, they may be suppressed by short sales.
Resolving delinquent loans by foreclosures or short sales will also have a secondary impact - those folks affected will have to pay for shelter again. Don't underestimate the stimulative effects of 13% of all borrowers not paying on their mortgage. If that number drops to a more normal low single digit number, that equates to a lot of lost spending potential.
Right now literally no one is paying for that stimulus, as banks, mortgage insurers, and the GSEs are assuming away that expense by reserving based on historical patterns of recoveries - they assume over half of those borrowers will eventually catch up on their payments and make them whole, which of course is a dream. There are a lot of unrecognized writeoffs sitting out there that someone, the borrower or the lender, will have to make good on.
Jeez, those are cheery thoughts to go with my cold cereal and milk this morning....
Economies of scale don't on the way down apparently.
The FED played all of their Real Estate cards, and still did not win the hand. What more can they do to try and fill the Real Estate de-leveraging debt hole. Not much.
After all their efforts, this is all they have to show; a small reverse trend blip in Case-Shiller. Trying to stabilize Real Estate prices through offsetting bad debt. It is just unbelievable. A misguided policy to help the banks and GSEs avoid bankruptcy. Epic.
Mark Beck
The "delays in processing" also appears to be causing local Real Estate prices to increase. This isn't getting much press coverage, but the increase in housing prices is.
For example, in the S.F. Bay Area, people are all giddy that housing prices are now going up. What they aren't looking at is that the inventory is at a record low. An incredible low. One-third of where it was last year in December in one county, 45% in another.
Meanwhile, the number of houses in foreclosure is the same, or several times higher than the number of houses on the market.
In short, we're seeing housing prices increase because the banks are keeping houses off of the market in order to keep the prices propped up. You won't see this mentioned anywhere in the press, except for the inventory graphs. And those are amazing.
Once the foreclosures start coming on the market, look out below. I really feel sorry for the first-time homeowners who are getting suckered into buying.
Google and Apple are responsible for a lot of the local price support in our neighborhood.
I'd seriously question that. Sure, there's some, but most of the action has been first time homebuyers and flippers fighting it out, with the flippers usually winning when they bring all cash offers to the table. At least that's what the local media has been reporting.
I'd expect the stock options to affect the higher end. And even there, prices have fallen and sales are slow. I think what we're seeing is mostly due the FHA limits. I don't see much action from the high tech companies.
Holding all the foreclosures off the market is going to pay huge dividends. Future biologists are going have a field day with new mold species discoveries.