The big US housing boom really started to dwindle in 2006 and increasing foreclosure news is constantly heard from media networks
. Many of today's homeowner's (maybe as much as 10% of them) simply cannot keep up with their payments.
Many of the foreclosed homes are tied to neighborhoods where subprime martgages were widespread. MS Foreclosure for example. Decreasing home values also contributed to the increase in number of these foreclosures. Add to that the fact that local government spending has also been cut way back because this decrease in home values has also resulted in a decrease in property taxes and their annual budgets.
There were signs of this coming however, three of them in fact. The first sign was the massive bailout of home owners that came. 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. In fact, many of these people even have above average or good credit ratings (not for long though). It is expected that unemployment would contribute to almost 60 percent of mortgage defaults. Unfortunately, this means that even more foreclosure news will be heard through the rest of this year.
The New York Times stated in February of 2009 that there are more than 1.5 million prime mortgages alone with delinquent payments (data by First American Core Logic). 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 $717 billion worth of loans were recorded in February - this is an increase of 60 percent from last year. These foreclosures spelled catastrophe for Wall Street due to the mortgage bonds that they are securitizing. 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 new Obama administration has announced a plan to try and help as many as four million homeowners via a $75 billion dollar spending bill. 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.