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Jobs, Foreclosures and The Weekend Poll

We have seriously bad news out of the Mortgage Bankers Association. More than 9 percent of all mortgage loans outstanding on one- to four-unit homes were at least one month behind on payments during the second quarter. That number, which is adjusted to reflect seasonal trends, broke the previous quarter's record level of delinquencies, and it doesn't even include people already in the foreclosure process. Count them in, and 13.6 percent (not seasonally adjusted) of loans are in trouble. That's the most MBA has recorded since the group started keeping track in 1972. Prime-credit, fixed-rate loans are leading the way, and MBA economists blame job losses for the trend. With job losses still coming, there's little reason to expect these numbers to turn around soon.

WEEKEND READING: In Saturday's Real Estate section, the Post's Dina ElBoghdady tells the story of two people who invested in foreclosure homes. One is a seasoned investor; the other a handy first-time homeowner. Who do you think fares best? And Emma L. Carew has tips on how to be more savvy when filing a homeowner's insurance claim.

CHAT DAY: Join me for the Real Estate Live chat today at 1 p.m. As always, you can submit comments early.

The Weekend Poll

This is a non-scientific user poll. Results are not statistically valid and cannot be assumed to reflect the views of Washington Post users as a group or the general population.

By Elizabeth Razzi  |  August 21, 2009; 6:00 AM ET
Categories:  Foreclosure , Mortgages , Poll , The economy , Weekend Poll  
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Next: Chat Plus: Pay Off the Second Mortgage or Save the Cash?


Why is this such disturbing news? 50% of Americans shouldn't be owning homes because they don't have the ability, means, etc to own homes.

What we have going on here is the 'correction' of 10-15+ years of consumption and greed and living off credit and equity.

Posted by: cavatellie | August 21, 2009 11:56 AM | Report abuse

It gets worse. The prime loan "cure" rates for delinquencies has dropped from 45% to 6.6% just from 2008 til 2009.
see a press release from Fitch or Calculated Risk.

So, while before we could expect most of the delinquencies to not become foreclosures, we're approaching a state where 1 month behind translates to a guarunteed REO! That's nuts.

I expect things aren't quite that dire for cure rates around here as our local unemployment isn't as bad as the national average.

Posted by: kingstowne_renter | August 25, 2009 3:51 PM | Report abuse

Can you provide a link to the story you mentioned on investing in forclosures? The post doesn't deliver to my area, and I searched for 15 minutes and could not find it on your real estate page. I found one on forclosures from Saturday, but it only talked about banks fixing things now vs. as-is.

Posted by: rubytuesday | August 26, 2009 8:44 AM | Report abuse

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