In Second Quarter Foreclosures Double

Compared to what it was a year ago, during the second quarter of 2008, foreclosure numbers doubled. Across the nation 739,714 units received foreclosure related notices during this quarter. It calculates to one out of 171 houses being in foreclosure.

Sale of houses have dropped, value of houses too are falling while lending standards have become tighter. Adding to this cocktail of woes is the economic slump. One is impacting on the other to make things worse. House owners are left with no other option but to succumb to foreclosure. The worth of the house has fallen below the loan amount leaving the lender with no incentive to strike a fresh deal.

Except for the two states of North Dakota and Alaska, foreclosure numbers increased in all the other states. The highest were in Nevada, California, Arizona and Florida. In Nevada the foreclosure rate was 1:43. California and Florida ranked among the 16 highest reo foreclosure hit metro regions. Stockton was the worst in numbers with a rate of 1:25. It calculates to being seven times the national median.

Banks REO are over 222,000 units across the country during the second quarter. It accounted for 30% of all the foreclosure operations. It was a hike of 24% from the previous quarter. Experts opine that 2.5 million houses across USA will slip into foreclosure before this year draws to an end. In 2007 it was 2007.

For the seventh time in the past eight months the sale of new houses plummeted. This is an indication that the foreclosure situation is worsening. According to the Department of Commerce the sale of new houses (single family) fell by 0.6% June. In May the fall had been greater – 1.7%. The seasonal adjusted rate was 530,000 reo houses.

The faint ray of hope was that the fall was slightly less than what had been expected. Nevertheless it was down by 33.2% from the previous year, same time. The sharp fall in housing prices is pushing the economy toward recession. It has set off an acute credit crunch. Many USA institutions are staggering with billions of dollars in losses from the faulty mortgage loans. The report showed that the average price of a new unit selling in June fell by 2% in comparison to the rate in the previous year. The south suffered the most with a drop of 2% while in the west it fell by 0.9%. In the northeast however there were sales increases by 5.3% and in the mid west by 2.5%.