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Foreclosures Hit All Time High
By Dan Handle, 06 Mar 10:54
More borrowers than ever are losing their homes or falling behind on payments. Rescue efforts have not reversed default trend.
NEW YORK (CNNMoney.com) -- More home owners than ever are losing the battle to make their monthly mortgage payments.
Two percent of all mortgages are currently in foreclosure, according to a survey by the Mortgage Bankers Association, the highest rate in the report's quarterly history. Foreclosures started during the quarter also hit a record, amounting to 0.83% of home loans.
Additionally, the number of mortgage borrowers who were over 30 days late on a payment in the last three months of 2007 is at its highest rate since 1985.
"Declining home prices are clearly the driving factor behind foreclosures, but the reasons and magnitude of the declines differ from state to state," said Doug Duncan, MBA's Chief Economist said in a prepared statement.
The foreclosure rates for prime and subprime adjustable rate mortgages both more than doubled compared with a year ago, from 0.41% for prime ARMs to 1.06% and from 2.70% for subprime ARMs to 5.29%.
But it was subprime ARMs that contributed most heavily to the nation's soaring foreclosure rates. Many of these loans come with low introductory rates that reset higher, often to unaffordable levels, in two or three years. Although they represent only 7% of all outstanding mortgage loans, they accounted for 42% of foreclosure starts during the quarter.
Delinquencies stood at 5.82% of outstanding mortgages, up from 5.59% during the three months ended September 30, 2007, according to the MBA. In the la
Tags: mortgages foreclosure