Foreclosures in the Headlines: What is Real and What is Not?

Foreclosures in the Headlines: What is Real and What is Not?

It’s natural to be a bit concerned about a foreclosure spike. However, it’s likely not as bad as it seems.

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Some Concern

A total of 95,712 U.S. properties with a foreclosure filing during the first quarter of 2023, up 6 percent from the previous quarter and up 22 percent from a year ago. The report also shows a total of 36,617 U.S. properties with foreclosure filings in March 2023. Up 20 percent from the previous month and up 10 percent from a year ago — the 23rd consecutive month with a year-over-year increase in U.S. foreclosure activity. According to NBC News, “Florida had a higher concentration of large metro areas with elevated foreclosure rates, the ATTOM data shows. Among the 223 metropolitan statistical areas with populations of at least 200,000, those with the highest foreclosure rates in May were Lakeland, Florida (1 in every 1,361 housing units with a foreclosure filing); Elkhart, Indiana (1 in every 1,621 housing units); Cleveland (1 in every 1,622); Palm Bay, Florida (1 in every 1,647); and Ocala, Florida (1 in every 1,671)...”

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Not Quite THAT Bad

Realtor.com tells us: “Real estate experts have stressed that this isn’t a repeat of the Great Recession. It’s not that scores of homeowners suddenly can’t afford their mortgage payments. Rather, many lenders are now catching up. The foreclosures would have happened during the pandemic if moratoriums hadn’t halted the proceedings. This explains why the average length of the foreclosure process hit an all-time high of 1,212 days, which translates into more than three years. Another key difference is many homeowners who lose their properties today often aren’t walking away empty-handed. Home prices have gone up so much over the past few years, that many struggling property owners who can’t afford their mortgages are choosing to sell their homes rather than undergo a foreclosure, which can damage their credit. Many are pocketing a profit from those sales, which can help them with a fresh start.”

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Keep a Cool Head

“Foreclosure activity remains significantly lower than it was prior to the COVID-19 pandemic. It seems clear that government and mortgage industry efforts during the pandemic, coupled with a strong economy, have helped prevent millions of unnecessary foreclosures,” says Rick Sharga, Executive VP of Market Intelligence at ATTOM

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Call Lesa Miller at (812) 360-3863 or go online where you can read her posts on other social media accounts and websites.

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