it was big news on Sept 6 (bloomberg and WSJ article below) ... I bolded the most striking points, like this- I personally believe this is only the beginning whats to come.
it should be known that subprime mortgages are only a part of the foreclosure market... this alone speaks volumes about the health of the debt market...
So the 64 thousand dollar question is- how do we make a killing in this market? Its here for the taking... and I see the bidding prices listed in newspapers are higher than what the market values of the properties are... entirely unrealistic... the banks have got to get rid of them...
Ideas? bring them on!
By Kathleen M. Howley
Sept. 6 (Bloomberg) -- The number of Americans who may lose
their homes to foreclosure rose to a record in the second quarter
and late payments by subprime borrowers surged to one out of every
seven loans.
The share of all U.S. mortgages entering foreclosure rose to
0.65 percent in the second quarter, an all-time high, from 0.58
percent in 2007's first three months, the Mortgage Bankers
Association said in a report today. The number of subprime
borrowers making late payments rose to 14.82 percent from 13.77
percent.
In the quarter, 2.73 percent of prime borrowers made their
mortgage payments at least 30 days late, up from 2.58 percent in
the first quarter, the report said.
The Mortgage Bankers report is based on a survey of 44.2
million loans by mortgage companies, commercial banks, thrifts,
credit unions and other financial institutions.
Record Number of Homes Entered
Foreclosure in Second Quarter
By DAMIAN PALETTA
September 6, 2007 10:12 a.m.
WASHINGTON -- A record number of homes entered the foreclosure process in the second quarter, and housing market problems have put mounting strain on prime loans, according to data released by the Mortgage Bankers Association.
This marked the third straight quarter of a record number of homes entering foreclosure. Pressure remained the most severe on subprime adjustable-rate mortgages, as 18 states reported at least 19% of these loans were delinquent. More than 26% of the borrowers with subprime ARMs in Mississippi and West Virginia were delinquent, MBA said.
On a seasonally adjusted basis, 0.65% of homes entered the foreclosure process in the second quarter, shattering the 0.58% record set in the first quarter. The second quarter foreclosure starts were 44% higher than in the second quarter of 2006.
The rise in foreclosure starts comes despite intensified efforts by regulators, lawmakers and lenders to stem the time of delinquencies, with close to 2 million adjustable-rate mortgages resetting by the end of next year into higher monthly payments.
Of the 44 million loans included in the MBA's National Delinquency Survey, 5.12% of all loans were past due, or delinquent, on a seasonally adjusted basis, compared with 4.84% that were past due at the end of the first quarter. The MBA's delinquency statistics do not include loans that are already in the foreclosure process.
The worst performing sector was subprime adjustable-rate mortgages, as 16.95% were past due, up from 15.75% in the first quarter and 12.24% in the second quarter of 2006. Of the subprime ARMs, 12.40% were considered "seriously delinquent," an early indication that they could be headed for foreclosure.
The performance of prime loans worsened in the second quarter as well. Total loans past due rose to 2.73% in the second quarter, up from 2.58% in the first quarter and 2.29% in the second quarter of 2006.
For prime adjustable-rate mortgages, 4.15% were past due, up 54% from the second quarter of 2006. Also, the number of prime ARMs entering the foreclosure process rose to 0.62%, a 296% increase from the second quarter of 2006.
The rare bright spot in the survey was that the inventory of subprime fixed-rate loans in foreclosure actually fell in the second quarter. Just 2.85% of subprime fixed-rate loans were in foreclosure in the second quarter, compared with 3.29% in the first quarter and 3.05% in the second quarter of 2006. This trend could change, however, as 10.99% of subprime fixed rate loans are now past due, up from 10.25% in the first quarter.
Mortgage markets are performing much different across the country, MBA data showed. For example, 9.33% of all loans in Mississippi were delinquent, though 21.5% of subprime loans were delinquent. In California, just 3.57% of all loans were delinquent, while 12.56% of subprime loans were past due.
The poor mortgage market performance comes as the mortgage industry is under stress, with liquidity problems for jumbo and subprime mortgages prompting a credit crunch that has made it difficult for some borrowers to obtain financing.
The MBA's new data are also expected to fuel efforts from Democrats to overhaul supervision of the lending industry. Senate Banking Committee Chairman Christopher Dodd (D., Conn.) unveiled his plans on Wednesday, and House Financial Services Committee Chairman Barney Frank (D., Mass.) is expected to release a different proposal in the coming weeks.
it should be known that subprime mortgages are only a part of the foreclosure market... this alone speaks volumes about the health of the debt market...
So the 64 thousand dollar question is- how do we make a killing in this market? Its here for the taking... and I see the bidding prices listed in newspapers are higher than what the market values of the properties are... entirely unrealistic... the banks have got to get rid of them...
Ideas? bring them on!
By Kathleen M. Howley
Sept. 6 (Bloomberg) -- The number of Americans who may lose
their homes to foreclosure rose to a record in the second quarter
and late payments by subprime borrowers surged to one out of every
seven loans.
The share of all U.S. mortgages entering foreclosure rose to
0.65 percent in the second quarter, an all-time high, from 0.58
percent in 2007's first three months, the Mortgage Bankers
Association said in a report today. The number of subprime
borrowers making late payments rose to 14.82 percent from 13.77
percent.
In the quarter, 2.73 percent of prime borrowers made their
mortgage payments at least 30 days late, up from 2.58 percent in
the first quarter, the report said.
The Mortgage Bankers report is based on a survey of 44.2
million loans by mortgage companies, commercial banks, thrifts,
credit unions and other financial institutions.
Record Number of Homes Entered
Foreclosure in Second Quarter
By DAMIAN PALETTA
September 6, 2007 10:12 a.m.
WASHINGTON -- A record number of homes entered the foreclosure process in the second quarter, and housing market problems have put mounting strain on prime loans, according to data released by the Mortgage Bankers Association.
This marked the third straight quarter of a record number of homes entering foreclosure. Pressure remained the most severe on subprime adjustable-rate mortgages, as 18 states reported at least 19% of these loans were delinquent. More than 26% of the borrowers with subprime ARMs in Mississippi and West Virginia were delinquent, MBA said.
On a seasonally adjusted basis, 0.65% of homes entered the foreclosure process in the second quarter, shattering the 0.58% record set in the first quarter. The second quarter foreclosure starts were 44% higher than in the second quarter of 2006.
The rise in foreclosure starts comes despite intensified efforts by regulators, lawmakers and lenders to stem the time of delinquencies, with close to 2 million adjustable-rate mortgages resetting by the end of next year into higher monthly payments.
Of the 44 million loans included in the MBA's National Delinquency Survey, 5.12% of all loans were past due, or delinquent, on a seasonally adjusted basis, compared with 4.84% that were past due at the end of the first quarter. The MBA's delinquency statistics do not include loans that are already in the foreclosure process.
The worst performing sector was subprime adjustable-rate mortgages, as 16.95% were past due, up from 15.75% in the first quarter and 12.24% in the second quarter of 2006. Of the subprime ARMs, 12.40% were considered "seriously delinquent," an early indication that they could be headed for foreclosure.
The performance of prime loans worsened in the second quarter as well. Total loans past due rose to 2.73% in the second quarter, up from 2.58% in the first quarter and 2.29% in the second quarter of 2006.
For prime adjustable-rate mortgages, 4.15% were past due, up 54% from the second quarter of 2006. Also, the number of prime ARMs entering the foreclosure process rose to 0.62%, a 296% increase from the second quarter of 2006.
The rare bright spot in the survey was that the inventory of subprime fixed-rate loans in foreclosure actually fell in the second quarter. Just 2.85% of subprime fixed-rate loans were in foreclosure in the second quarter, compared with 3.29% in the first quarter and 3.05% in the second quarter of 2006. This trend could change, however, as 10.99% of subprime fixed rate loans are now past due, up from 10.25% in the first quarter.
Mortgage markets are performing much different across the country, MBA data showed. For example, 9.33% of all loans in Mississippi were delinquent, though 21.5% of subprime loans were delinquent. In California, just 3.57% of all loans were delinquent, while 12.56% of subprime loans were past due.
The poor mortgage market performance comes as the mortgage industry is under stress, with liquidity problems for jumbo and subprime mortgages prompting a credit crunch that has made it difficult for some borrowers to obtain financing.
The MBA's new data are also expected to fuel efforts from Democrats to overhaul supervision of the lending industry. Senate Banking Committee Chairman Christopher Dodd (D., Conn.) unveiled his plans on Wednesday, and House Financial Services Committee Chairman Barney Frank (D., Mass.) is expected to release a different proposal in the coming weeks.
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