"But it's likely that foreclosures will remain below normal levels at least through the end of the year," he added. Sharga expects to see foreclosure activity increase over the next three months, as loans that were in default prior to the pandemic-related foreclosure moratorium reenter the foreclosure pipeline, and states begin to catch up on months of foreclosure filings that weren't processed during the pandemic. "As expected, foreclosure activity increased as the government's foreclosure moratorium expired, but this doesn't mean we should expect to see a flood of distressed properties coming to market," said Rick Sharga, executive vice president at RealtyTrac, an Attom company that lists foreclosed properties for sale. Foreclosure starts were more than three times higher in August 2019, pre-pandemic. While those jumps may seem large, they are off a very low base. "Home price appreciation continues to escalate as millennials entering their prime homebuying years, renters looking to escape skyrocketing rents and deep pocketed investors drive demand," said Frank Martell, president and CEO of CoreLogic.Įven with sky-high prices and equity, foreclosure starts (the beginning of the foreclosure process), rose in August, up 27% from July and up 60% from August 2020, according to Attom, a foreclosure and data company. Some states, like Idaho and Arizona, saw even bigger gains at 33% and 28%, respectively. The latest read from CoreLogic in July showed home prices nationally up a record 18% from July 2020. "Such strong equity positions should help limit the volume of distressed inflow into the real estate market as well as provide strong incentive for homeowners to return to making mortgage payments - even if needing to be reduced through modification," said Ben Graboske, president of data and analytics for Black Knight. Given today's tight housing market, the majority could easily sell and still pocket some profit. Including those payments, 93% still have more than 10% equity. But 98% of those troubled borrowers now have at least 10% equity in their homes, not counting their missed payments. There are still 1.618 million borrowers in forbearance programs (down from roughly 5 million at the peak in May 2020), or 3.1% of all outstanding mortgages, representing an unpaid balance of $313 billion. September is expected to see an outsized group of 400,000 expirations because the wave of borrowers enrolling was highest in March and April 2020. 26, 2010 3:23 PM ET KBE, KME, KRE 20 Comments Bruce Krasting 8.71K Follower s Follow I have been working with a young couple for a year now. Borrowers were allowed up to 18 months of forbearance from entry into the programs, so expirations are now rolling. New Wave of Mortgage Defaults on the Horizon Mar. The drop was driven by August expirations. The number of active mortgage forbearance plans, in which borrowers were allowed to delay their monthly payments, fell by more than 5% from the previous week, according to a new report from Black Knight, a mortgage data and analytics firm. Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit
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