Record 2009 Foreclosures Despite Aid

U.S. foreclosure actions shattered all records in 2009 and will do so again this year, with unemployment and wage cuts overcoming programs to remedy failing home loans, according to RealtyTrac, an Irvine, Ca.-based data company. A record 2.8 million properties with a mortgage got a foreclosure notice last year, jumping 21 percent from 2008 and 120 percent from 2007.

January 14, 2010

U.S. foreclosure actions shattered all records in 2009 and will do so again this year, with unemployment and wage cuts overcoming programs to remedy failing home loans, according to RealtyTrac, an Irvine, Ca.-based data company. A record 2.8 million properties with a mortgage got a foreclosure notice last year, jumping 21 percent from 2008 and 120 percent from 2007.

- Foreclosure prevention programs and loan processing delays caused by sheer volume prevented the failure rate from being even worse.
- A new record of at least 3 million properties are expected to get a filing is seen in 2010.
- Until the lenders start to get into principal balance reduction, high redefault rates will probably continue, says RealtyTrac.
- One in every 45 households got at least one filing last year, a rate almost four times that of 2006.
- Nevada had the highest foreclosure rate for the third straight year. Over 10% of households with loans experienced foreclosure. notice.
- Arizona and Florida were in second and third places.
- California, Utah, Idaho, Georgia, Michigan, Illinois and Colorado were the other states with loan failure rates among the 10 highest for U.S. states.
- California, Florida, Arizona and Illinois accounted for more than half of all foreclosure actions in 2009 as more than 1.4 million properties got a notice.

On a quarterly basis, foreclosure activity did slow in the fourth quarter, declining 7 percent from the third, but rose 18 percent from the fourth quarter of 2008. Refinancing to lower monthly costs was also out of the question for many homeowners because the value of their house fell below the size of their mortgage.

Banks repossessed a record of more than 918,000 properties last year, 6.5 percent more than in 2008. Banks have half a million houses on their books yet to be put on the market. Another 1 million properties in are foreclosure and 5.5 million have delinquent loans. However, the doomsday prognostications that have 7 million properties all going to go back to the banks and hitting the market at the same time is not realistic, RealtyTrac said.

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