Home equity losses are increasing the number of foreclosures as millions of Americans are becoming upside down in their houses, and more are joining the ranks daily.
Being upside down in your house can be a nightmare. More homeowners are finding themselves in this precarious position, and by growing numbers homeowners are walking away from the mortgage that just got too high to pay.
Americans are showing a sort of panic in many places over the housing crisis. Foreclosures are increasing. It has turned into an economic crisis that is sending the nation into a recession, if we aren’t already there.
The White House is working on a plan with mortgage lenders on subprime loans, but the time it will take to go into effect and what real substance it will have is paramount to the national economy.
An increasingly large number of homeowners are asking what it’s going to be like next year in their housing market. The growing uncertainty has added growing impatience over the real estate marketplace.
Being upside down is a state of financial bewilderment at first owing more on your home than its worth in today’s housing market. A growing number of American homeowners are facing this reality, and it isn’t going to change any time soon. Housing Predictor forecasts that the national housing market won’t be making a full rebound until at least 2011.
With increasing government actions to abate the series of problems plaguing the industry, the real estate market won’t stabilize until at least 2010, according to Housing Predictor analysts.A record high 18 million homes sit vacant across the country.
Foreclosures are at record all time highs and worsening. Foreclosures have doubled in the past twelve months alone and the number of defaults is increasing. What started as a subprime problem has bleed over into mainstream mortgages and more than the credit markets are impacted. Credit card and auto loan companies report increasing delinquencies.
However, there will be local isolated housing markets that will weather the storm well. There are always real estate markets that are the exceptions to the rule. But the over-whelming majority of housing markets are deflating, many at record rates.
It use to be that by its very nature real estate markets were local in nature driven by local economic and political forces. But the new breed of liberalized mortgage lending, pushed by the greed of Wall Street investment hedge fund buyers has changed the mortgage market in the U.S. Mortgages were sold on Wall Street like commodities to investors before the music stopped, and investors buying the securities realized what was going on and stopped buying the securities in mass.
It isn’t only subprime mortgage borrowers that are in trouble any longer. Conventional loans are becoming the new addition to the foreclosure line-up and there isn’t much many homeowners who are upside down in their house can do to get their home refinanced with falling home values. Some housing markets have already dropped as much as 50% in California and Florida and many others are close behind.
Programs to assist homeowners with their mortgages have been started in California, North Carolina and Ohio among a handful of other states. But the national crisis is worsening and is in desperate need of surgery before the U.S. economy is damaged further.