U.S. Foreclosures Shock Wave Ripples Through Housing Market

By: Peter_Schiff

Bloomberg is reporting U.S. Foreclosures Hit Record in August as Housing Prices Fell .
U.S. foreclosure filings rose to a record in August as falling home prices made it harder to sell or refinance homes to pay off the mortgage, RealtyTrac Inc. said.

Owners of 303,879 properties, or one in 416 U.S. households, got a default notice, were warned of a pending auction or foreclosed on last month. That was the most since reporting began in January 2005. Filings increased 27 percent from a year earlier, about half the annual pace of previous months, because of high default totals in August 2007, the Irvine, California- based seller of foreclosure data said in a statement today.

The worst housing slump since the 1930s shows little sign of abating. Home prices in 20 U.S. metropolitan areas declined 15.9 percent in June from a year earlier, according to the S&P/Case-Shiller index.

Financing is difficult to obtain, and borrowers must put down 20 percent to 30 percent of the purchase price, said Mark Goldman, senior loan officer at Windsor Capital Mortgage in San Diego. About 90 percent of borrowers at his company get 30-year, fixed-interest-rate loans, he said.

Nevada had the nation's highest foreclosure rate for the 20th consecutive month with one in 91 households in some stage of default, according to RealtyTrac. Filings rose 16 percent from the previous month and 89 percent from a year earlier to 11,706.

California had the second-highest rate, one in 130 households, and the most filings at 101,724, a third of the nation's total. Defaults increased 40 percent from the previous month and 76 percent from August 2007.

Arizona had the third-highest rate at one in 182 households, followed by Florida, Michigan, Georgia, Ohio, Colorado, Illinois and Indiana, RealtyTrac said.

Florida ranked second with 44,000 filings, a 4 percent decrease from the previous month and a 30 percent increase from August 2007. Arizona was third in filings at 14,333, up 7 percent from July and almost 63 percent from a year earlier.

Michigan ranked fourth in filings at 13,605. Defaults decreased 13 percent from a year earlier. Nevada, Ohio, Texas, Illinois, Georgia and New Jersey were also among the top 10 states with the most filings, RealtyTrac said.

New Jersey's foreclosure rate ranked 11th at one filing in 536 households, and New York ranked 33rd at one in 1,444 households.

California had eight of the 10 metropolitan areas with the highest foreclosure rates, led by Stockton at one in 50 households. Merced, Modesto, Vallejo-Fairfield and Riverside-San Bernardino ranked second through fifth. Bakersfield, Salinas- Monterey and Sacramento, the state capital, ranked eighth through 10th.

Cape Coral-Fort Myers, Florida, had the sixth-highest metro foreclosure rate at one in 66 households and saw a 3 percent decrease in filings. Las Vegas was seventh at one in 75 households, and had an 83 percent increase in defaults, according to RealtyTrac.

Idiotic "Solutions"

Those are exactly the kind of stats that propel Congress to come up with idiotic solutions . If you have not yet done so, please consider statements made by Senators Senators Charles Schumer and Robert Menendez as detailed in Senators Schumer and Menendez Unqualified for Office .

By Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

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