The big US housing boom really started to dwindle in 2006 and increasing foreclosed news is constantly heard from media networks.  Homeowners began to lose their homes or are threatened with foreclosures because they have failed to keep up with the payments on their mortgage.

Many of the foreclosed homes are tied to neighborhoods where subprime martgages were widespread.  MS Foreclosure are just one example. Unfortunately this has led to a decrease in home values as well which just adds fuel to the fire.  Additionally, state and most local governments were forced to cut back on their spending because the drop in the value of these properties sharply decreased their tax bases.

There were signs of this coming however, three of them in fact.  First was the bailing out of property owners due to the plummeting prices of real estate.  The second sign was all of the sub-prime loans and adjustable rate mortgages beginning to implode.  Lastly, the third sign has been the fact that even prime rate loan holders are losing their homes now due to job loss and the economic crisis.  Most of them even have good credit ratings.  Unemployment is now forecast to impact about 60 percent of all of the mortgage defaults.  Unfortunately, this means that even more foreclosure news will be heard through the rest of this year.

According to an analysis made by New York Times in February 2009 (data provided by First American Core Logic), the number of prime mortgages that have delinquent payments exceeded 1.5 million with loans totaling to 4 billion.  On the same month, delinquencies on subprime mortgages reached 1.65 million while the Alt-A loans rose to 836,000.  In all, a total of 7 billion worth of loans were recorded in February – this is an increase of 60 percent from last year.  All of these foreclosures have also dramatically impacted Wall Street and mortgage bonds.  These also lead to bank loses of hundreds of billions. (Note: Search on ‘forecloser‘ as well because it is a very common miss-spelling of foreclosure and is prevalent in the foreclosure news posts.)

The Obama administration announced in February that they will be spending billion to save as much as four million homeowners from foreclosures through mortgage incentives and reduced payments.  The effects of this plan are expected to be felt in the next coming months.  Until that time comes, you will need to brace for the storm and all of the foreclosure news that is still looming out there.