Foreclosure Housing Boom Families MortgageHundreds of thousands of families all over the nation were foreclosed upon last year and this year looks just as grim. It’s sad and unfortunate that people financed and purchased homes they clearly could not afford.  I’m sure they were all hyped about the appreciation the country was seeing and thought it was a win-win situation. Maybe they were looking for a quick flip for some extra cash or were talked into a stated program, pay option arm, or even a no doc program. Who knew it was going to be so difficult to find a buyer or people would stretch themselves so thin that even finding a renter would not fit. Take a look at this article I found:

The number of housing foreclosures rose sharply across the country in 2006, reported Default Research (http://www.defaultresearch.com/), the rapidly growing real estate research company for foreclosure properties. The largest increase in foreclosure activity was in Nevada (up 166 percent); while the smallest increase was in Washington State (up only 18 percent).

“Default Research processed over 250,000 pre-foreclosures in 2006,” said Serdar Bankaci, president and chief executive officer of Default Research, Inc. “You can expect to see the foreclosure rate to continue to increase in 2007 - not as much as 2006 - but there will be excellent opportunities to help homeowners in distress and turn a profit too. This is the definition of a buyers market!”

According to Bankaci, there were several very important factors that contributed to the high foreclosure activity in 2006. One was the amount of sub-prime mortgages that were granted in the past few years; second was the dramatic increase in energy costs; followed by slowing home sales and rate adjustments.

“Most people obtained loans on stated income and negative amortization and now have no clue what to do since their payments are escalating, and they are not making any more money,” said Hillman, who works in San Diego County.

Default Research is the national leader in real estate research. More information about Default Research can be found at their Web site: http://www.defaultresearch.com/.

  The following table gives foreclosure rates by state:

                    2006
  State            change
  Arizona        82.23 %
  California      128.20 %
  Florida          143.52 %
  Michigan       83.14 %
  Nevada         166.19 %
  New Mexico   39.03 %
  Washington  18.89 %

Just a quick tip, be sure to meet with a Mortgage Planner on your next purchase, one who will sit down and talk to you about your goals and plans of the future. We as mortgage planners, always break down where you’re currently sitting financially and where you want to be. Before we look at products and programs we get the whole financial picture and see what’s best. And be sure to always get an Annual Mortgage Review.

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