Foreclosures Abound in My City

Here's where a couple of my posts come together into one.

It started when I wrote that I was considering buying a foreclosed home. (No news on that by the way -- I can't get the agent to call me back.) Then I asked if the worst of the housing slump was over. Soon after I posted that second piece, I found this one from my neck of the woods saying that the housing market (and associated foreclosures) was as bad as ever. Here are the details:

Foreclosure filings in Kent County are coming in at a record pace not seen for many years. In the 1990s, there were roughly 500 foreclosures a year. In 2006, 2,500 homes foreclosed in Kent County - up 74 percent from 2005. So far this year, the Register of Deeds told 24 Hour News 8 more than 60 foreclosures per week are being filed, more than 1,000 total through April. The county projects more than 3,200 for 2007.

As I noted in my post on the housing slump, I'm in a particularly hard hit market. Michigan as a whole is in a rough place now and in our area of the state we've had several big firms close shop or announce massive layoffs.

Nationally, there are a lot of foreclosures on the horizon:

The Center for Responsible Lending said, while the subprime market produced more than $2 trillion in home loans over the past nine years, it's forecasting almost 1 million American families will fail to make payments and lose their homes.

And I found this quote particularly insightful:

Realtor Kerrie Idema told 24 Hour News 8, "I showed seven homes between $180,000 - $220,000, and three of the seven were in some state of foreclosure."

As we look for a new house we have issues both as buyers and sellers. But the buying end seems clear -- there's still room for price declines and waiting it out will probably save us a good chunk of money.

Comments

[D]

I just wanted to add, if you are serious about buying a foreclosure (my house was one), find it then head to the county. Look the deed and mortages up. Try and make contact with the current owner. Maybe you can help them get out from under a 10 year foreclosure on their credit.

Although, I would not recommend just paying them their mortgage values. I know some folks do this, I personally do not think it is right. Those people will need some money to put another roof over their head. Reviewing their mortgages will give you some idea if you can accomplish this.

It takes a little time, and some counties are a maze of confussion but most folks there will help you.

[TSmith]

I work for a foreclosures site and we have been noticing a huge increase in the number of foreclosures on the market. I believe it is because of subprime lending, ARM loans, the depreciation in housing prices, and the lack of buyers on the market. I do no believe that the housing slump is over-I do not even think it will end this year. I think that it will continue, and truly hit bottom when a huge number of ARM interest rates reset next year. With the higher interest rates, a lot of people will face foreclosure as they are not able to make the significantly higher monthly payment, and with the depreciation in housing prices nationwide, they will be unable to refinance their homes to avoid the higher rates. By the way....Michigan is rated 4th in our foreclosures list-meaning that it is the fourth in the nation for the highest number of foreclosures on our site.