Foreclosures have been steadily on the rise, especially with the housing market and economy in a constant state of flux right now. Let’s take a look at recent statistics and discuss briefly what it can mean to you. Knowing and understanding statistics can assist you if you are in the market for a new home or are planning to sell your current home in a market that is not as favorable as it used to be not that long ago.
Foreclosure Statistics – Cause And Effect By The Numbers
The recent upward trend of foreclosures has a cause based in the sub-prime market crisis we have all heard so much about in the news lately. Many people were given loans that they did not qualify for and are unable to pay and therefore are now being forced into on their homes. A look at the current statistics shows that approximately 2% of all homes in the U.S. are currently in the process of foreclosure, with California and Nevada leading the way.
While that number is very bad it can also be very misleading. In the opinion of many experts, the sub-prime market crisis has really just begun, and in many cases, banks and mortgage lenders are scrambling to keep peoples’ homes from reaching the stage. Eventually the lenders and borrowers will run out of options and as the economy worsens, we should see a significant increase in statistics.
Currently, a total of 8% of all home loans are either in the process or dangerously delinquent. While delinquencies are not included in statistics, this 8% figure shows that there is a significant amount of homes that are in danger of going from ‘in trouble’ to ‘foreclosure’. This puts pressure on the housing market and has caused home values to decline dramatically compared to years past.
When considering these statistics, what does it mean to you the homeowner? Certainly, if you are staying current with your mortgage payment and able to retain your home, you should feel very good. If you are planning to stay in your home and were able to take advantage of the low interest rates of the last couple of years, even better for you!
However, if you are planning to move or need to sell your home, you could be in for some difficulty. Lenders are becoming much stricter and people are finding it much tougher to get a loan. Additionally, because of the unbalanced market right now, and because of declining home values, fewer people are looking to invest in property. Once a staple of the economy and seen as very stable market, the home industry has become volatile and dangerous due to the crisis.
Hopefully the statistics and above information shed some light on the current market situation. If you are looking to sell your home for whatever reason, the best thing to do right now is keep making your payments and stay put until this crisis eases and both the housing market and economy turn around.
