Equifax, a well-respected credit bureau, found that 7% of homeowners with mortgages that were at least 30 days late on their payments in February, that’s up 50% from a year ago. And close to 40% of subprime borrowers are late, up from 23.7% a year ago.
Then I get an email from mortgage guru Mark Hansen of the Field Check Group, who tells me that foreclosures are about to soar in California near-term:
For months prior to March, banks/servicers were on and off of foreclosure moratoria with many on a complete hold awaiting Pres. Obama’s plan to save the housing market and homeowners. We track each foreclosure start through the entire foreclosure process individually and in aggregate - also by originator and servicer - and as soon as the Obama plan was made known, banks/servicer shifted their Notice-of-Default and Notice-of-Trustee Sale machines into overdrive. Foreclosure start (NOD) and Trustee Sale (NTS) notices are going out at levels not seen since mid 2008. Once an NTS goes out, the property is taken to the courthouse and auctioned within 21-45 days.
On top of that, my colleague Jane Wellsis out in the foreclosure capital of the world today, Stockton, CA, and while she reports good news that houses there are finally selling, the bad news, she says is that more and more as major lenders seek out troubled borrowers for modifications, that find, “the people are gone. Even if they’ve not been foreclosed on yet!”
Not good. With job numbers getting worse, more and more borrowers are going to end up missing payments, and no matter how much the banks and the Obama administration would like to help these folks, you can’t modify a loan down to a zero monthly payment.
Questions? Comments? RealtyCheck@cnbc.com