Number of Foreclosure Homes Still on the Rise

There was a five percent increase in the number of foreclosure homes during the third quarter of 2009 when compared to the second quarter of the same year.  The increase occurred despite the presence of the Making Home Affordable program of the federal government that attempts to help borrowers undergoing financial hardships to get a loan modification to reduce their monthly payments.  Apparently, the government program was overpowered by the large increase in the number of people without jobs.

There were almost 938,000 foreclosure homes during the period of July to September 2009, which is approximately 48,000 homes more than the preceding quarter.  At this rate, the number of foreclosure filings is expected to reach approximately 3.5 million for the whole year of 2009, which is much higher than the 2.3 million filings in 2008.

Many economists have been declaring that the recession has ended but the foreclosure rate is still on the rise because the unemployment rate has reached an unprecedented level of 9.8 percent during the past 26 years.  To make matters worse, the unemployment rate is predicted to continue to rise until it will reach its peak in the middle of 2010.  Mortgage lenders are trying to help by permitting the homeowners to be delayed by three to six months in their payments as they look for work.  Unfortunately, looking for work at a time when the unemployment rate has reached an all-time high is very tough.

The Administration of President Obama had recently reported that its initiative has attained an important milestone when more than 500,000 loan modifications have been granted.  However, the rise in the number of people defaulting on their loans has been much faster than the increase in the number of people getting loan modifications.

Somehow, mortgage companies have been trying to reduce the impact of the housing crisis by slowing down the rate of foreclosures.  They have been trying to examine whether the borrowers would be able to fulfill the requirements for the Making Home Affordable program of the Obama Administration.  However, analysts believe that a large number of these homeowners would not be eligible and they predict that more forecloser homes will become available in 2010.  This is expected to pull down home market values further.  Banks and other lenders are unable to find a loan modification plan that is suitable for the present income capabilities of the homeowners in view of the gravity of their financial hardships. For more foreclosure news stop by http://www.bestforeclosurenews.com

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