US Foreclosure Prevention Programs Not Working

If you’re thinking that this foreclosure, banking crisis is close to over, think again.  RealtyTrac last week released additional data on state foreclosure data.  The full report can be seen at their site at this link.
It’s interesting to note that huge percentage increases in foreclosure from 2006.

A graphical view of the foreclosure “mess”

In their report, RT pointed out that the prevention programs that had been instituted are not having the desired results of stemming the foreclosures.  As you can see in the chart below, the law changes have been useful in slowing, but certainly not arresting the number of foreclosures.

“State legislation that slowed down the onset of new foreclosure activity clearly had an effect on fourth quarter numbers overall, but that effect appears to have worn off by December,” said James J. Saccacio, chief executive officer of RealtyTrac. “The big jump in December foreclosure activity was somewhat surprising given the moratoria enacted by both Freddie Mac and Fannie Mae, along with programs from some of the major lenders and loan servicers aimed at delaying foreclosure actions against distressed homeowners.

“Clearly the foreclosure prevention programs implemented to-date have not had any real success in slowing down this foreclosure tsunami. And the recent California law, much like its predecessors in Massachusetts and Maryland, appears to have done little more than delay the inevitable foreclosure proceedings for thousands of homeowners.”

The chart below breaks out the information based on the  Top 100 US Metro Areas.  MA sticks out again, as Boston, Worcester and Springfield are in the top 50 - not really an honorable distinction.

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