Is the property market in Iowa finally stabilizing?– ForeclosureConnections

Is the property market in Iowa finally stabilizing

? ForeclosureConnections

The rate of Iowa foreclosures finally seems to be leveling off, thanks to local economic improvements and home mortgage modifications. The proportion of past-due or in-foreclosure mortgages was down in the first quarter of 2010 to 8.6%, from a high of 10.1% at the end of 2009 (but still above the rate of 7.6% year-on-year.

That's great news for the State's embattled home-owning households, so many of whom have been facing the confiscation of their beloved homes.

Mortgage Bankers Association Chief Economist Jay Brinkmann thinks this could be the result of seasonal tendencies. "Delinquency rates traditionally peak in the fourth quarter and fall in the first quarter," he was quoted as saying in the MBA survey released on Wednesday.

That's because homeowners are traditionally faced with higher heating bills at that time, not to mention Christmas holiday spending patterns, although they do also often recover by the end of the following March. Iowa Attorney General Tom Miller thinks that part of the early 2010 decline can be attributed to a combination of economic improvements, and his office's mediation and hot-line efforts to advise households confronted with foreclosure.

Whatever the reason, or combination of reasons in play, Iowa's percentage homes in foreclosure at the end of March 2010 was just 2.7% (up from 2.3% year-on-year) compared to the national figure of 4.6%, or 3.8% last year. Iowa's lower unemployment rate of 6.8% (compared to 9.7% countrywide) undoubtedly also played a role.

The Attorney General believes that the relatively lower rate of new foreclosure notices too indicates that, for Iowa at least, the property market stabilizing.

More good news is that over 2,700 Iowa households were able to keep their homes thanks to HAMP initiatives, not counting the 791 mortgage modifications made permanent in April this year. To put this in context, there are currently about 636,000 active trial modifications throughout America and around 295,000 permanent ones in place.

Wells Fargo, the second biggest player in the home loan business at the close of 2009, has modified nearly 112,000 mortgages this far, of which over 36,000 are now permanent. "We continue our efforts to find options that will allow mortgage customers facing financial hardships to stay in their homes through one of our own modification programs or through HAMP", says co-president of Wells Fargo Home Mortgage in West Des Moines Mike Heid.

His company's efforts seem to be working, with over 90% of their borrowers current on their payments.

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