Foreclosures spike 112% - no end in sight

[Lone_Star_Dem]

Source: CNN Money

More than 155,000 families have lost their homes to foreclosure this year; one out of every 194 U.S. households received a foreclosure filing.

NEW YORK (CNNMoney.com) -- Foreclosure filings in the first three months of 2008 rose more than 112% over last year, according to a study released Tuesday.

Real estate information firm RealtyTrac reported that nearly 650,000 foreclosure filings - which include notices of default, auction sales and bank repossessions - were issued in the first quarter. That represents 1 of every 194 households and marks a 23% increase from the last quarter of 2007.

So far this year 156,463 families have lost their homes to repossessions.

"Foreclosure activity hasn't slowed down yet," said Rick Sharga, spokesman for RealtyTrac. "But I was a little surprised that foreclosure filings more than doubled since last year."

Read more: http://money.cnn.com/2008/04/29/real_estate/foreclosures_still_rising/index.htm?postversion=2008042909

[chiffon]

1. whoa, this is not good and I am sure we are in the dark

about the real state of the national economy.

[gaspee]

2. My question is

Where are these people all going?

Moving in with relatives? Rental housing? The streets?

There are entire subdivisions, almost complete, that are empty because the builders ran out of money. There are neighborhoods where every other house is boarded up.

One in 194 homes were foreclosed on? That's a damn scary number.

[David__77]

7. Rental housing, relatives, etc.

A lot an so-called analysts are surprised that rents are stable because of the influx of renters due to foreclosures. I'm not surprised. The rental market is flooded with "investors" trying to sell homes they do not live in. In the interim, they are renting these houses, and they often escape inclusion in rental statistics.

[paparush]

3. Yeah.. but..., but.. Shell and BP reported record quarters!

The state our economy is STRONG! :sarcasm:

[Hydra]

4. The hard numbers don't jive with what the gov't is telling us

This is a disaster, and they are to blame. Great Depression 2.0 coming to a nation near you.

[Zachstar]

9. There was plenty of cheap gas during the depression.

You may not have much of a home back then but if you had a car and a few cents you could drive and drive.

Today a depression will mean far worse because people will not be able to move around. They will sit and deteriorate while gas continues to climb at whatever stations can still run gas because depression in china means nothing when they can continue flooding our market with cheap stuff at insanely low prices so the have nots can afford them somewhat.

A depression means we wont be coming back from it. We will be virtually enslaved by China.

[Courtesy Flush]

5. What don't I understand here?

If I understand correctly, people are losing their homes not because they lost their income, but because of balloon mortgages. They can afford the house, just not the exploding rates.

Seems like the banks would prefer to re-mortgage the home to the same family, and offer them terms they can afford. It may mean a loss of any interest they already paid, or a longer term, but why foreclose in the face of this national disaster, and end up trying to sell the house in a depressed housing market?

Does that make sense?

I know nothing about finances, so forgive me for being naive.

[David__77]

8. Many people want to walk away though.

Why would someone want to pay off a loan that is much larger than the value of their property. Declining home values mean many are in this exact position. In my area, median prices are 36% of their peak, which is high compared to the average regional price decline so it's serious here. People are just saying "screw this" and leaving. I'm just glad property values are coming down. This was insane and unsustainable.

[ckramer]

6. Home price always goes up

is it not?