Owners In Foreclosure Up Nationally
Across the country owners facing foreclosure are becoming more and more commonplace. RealtyTrac, an online company that tracks foreclosures from New Jersey to California reported that for the first quarter of 2007 there were more than 430,000 foreclosure filings, including default notices, auction sale notices and bank repossessions. That is a 27 percent increase from the previous quarter and a 35 percent increase from the first quarter of 2006. The 10 states with the highest rate of foreclosures include: Nevada, Colorado, Georgia, Michigan, California, Florida, Arizona, Ohio, Texas and New Jersey.
Why the increase? Based on our experience working with owners trying to stop foreclosure we understand that there is not just factor or circumstance that causes them to fall behind on their mortgage. Loss of a job, illness, divorce, and many other unexpected financial strains can all be contributing factors. Another more common factor however is the resetting of adjustable rate mortgages.
Now we are seeing more and more ARM mortgages reset from initial low teaser rates to much higher rates that in many cases double a borrower's monthly mortgage payment. The availability of cheap money for all those years that the real estate market was booming is now coming back to haunt owners who experience a slight bump in the road.
