During the first six months of 2009, it was a record that 1.53 million US properties & assets were in the process of foreclosure - default notices, auction sale notices and bank repossessions. This figure is 9% more than the last six months of 2008 and 15% more than 1st six months of 2008, according to the US market reviews.
According to the report, there were 1.91 million foreclosure filings which are considered as 1 single property out of every 84 U.S. properties in the first half of the year 2009. Financial institutions or banks repossessed almost 386,800 properties in last 6 months. In addition to that there was no improvement in housing recovery in June, the last month of the cycle which is a very bad sign for the economy.
In the month of June,2009 ;More than 336,000 homeowners filled foreclosure , which is over 33% from June,2008 and nearly more than 5% with May 2009.
The biggest reason which really affecting foreclosure statistics is the recession. People were losing jobs in different sectors & were unable to payoff their respective debts. As a result, the number of out-of-work borrowers or defaulters is increasing. The prices of the properties are still going downwards at a slower rate, which pushes more homeowners into uncertainty because drop down of home-prices means more homeowners owing to the bank much more than their home is worth. That discourages them fully from repaying their respective monthly loan payment because they realize that it will be a foolish financial decision to keep paying on an asset which is having decreasing money value. Reports says that homeowners are deliberately surrendered their mortgages once their asset value fall 15% below their mortgage balances.
Experts added that at least 25% of all mortgage defaults may be "strategic”, because borrowers have lost so much value of their respective assets that they walking away from their homes. It was found that the areas which mostly affected by foreclosure, home prices have fallen by 40% or more.
However, parts of the borrowers are negotiating with their lenders, constantly trying to soften the terms of their debt so they can payback their loans & stay in their homes. But that process has been slow and infuriating to many borrowers. As a result, foreclosure rate is massively increasing.
California was recorded foreclosure more than any other state with 391,611 filings, one for every 34 households. Nevada had the highest foreclosure rate with one for every 16 households. Arizona, one for every 30, and Florida, one for every 33. Georgia, at one for every 70 households, is sixth,Michigan recorded one for every 74 households,holds the seventh place. Illinois came in eighth with one for every 76; and Idaho, one for every 79, holds ninth position .Colorado, with one for every 80, secured the tenth position and Ohio, with one for every 86, was twelfth.
