1 in 8 homeowners behind on mortgage payments
Filed under: Real Estate, Recession, Investing
One of the most tragically funny parts of the housing meltdown has been watching the "glass is half-full" pundits reminding us that as bad as the housing crisis is, most people are still fine.In March of 2007, the sky-is-not-falling crowd was screaming "Relax! More than 95% of people are current on their mortgages!" In the first quarter of 2008, it was "Sure it's bad, but 92% of people are still up to date on their house payments!"
Now that one in eight people are behind on their mortgages, the "it's not so bad" crowd seems to have quieted down a bit -- we're below 90% and "Relax! 88% of people aren't living in a house of pain!" just doesn't have the same ring to it. It's the highest delinquency rate since 1972.
But here's the reason that we should relax: Every time someone falls behind on payments and loses a home, the house is put on the market and the excess inventory has been driving down home prices for the past two years. Every single foreclosure results in an opportunity for someone else to buy a home. Maybe that's a first-time buyer and maybe it's an investor -- whose contribution to the rental housing stock will help keep rentals affordable.
It's not the nicest way for it to happen, but the point is that doors are opening and doors are closing in our economy. Many people will make a lot of money buying real estate at currently distressed prices, and many first-time buyers will make the best investment of their lives.
Reader Comments (Page 1 of 1)
6-30-2009 @ 11:59AM
nick said...
Those 1 in 8 must be from Rep Waters district, all those slugs she got into houses they couldn't afford. I guess that is why she needed to cover rpt cover for FRANKLIN RAINES. And guess what here old man is deep into Obama money also, what a game these slugs are paying with tax payer money. WAKE UP AMERICA BEFORE THE REP WATERS AND FRANKS OF THIS WORLD AND THROW SLIME BAG SEN DODD INTO THE MIX, THEIR TAKING US TOO 3RD WORLD STATUS!!!
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7-12-2009 @ 2:22AM
hannah said...
how can a finance com send u a letter telling u that u are in default on your loan when u are 1 mo behind & u told them u would get it paid as soon as u got the money. u have been paying each month on this account but u haven't been able to get the one payment u are behind on paid up. then they send u a letter saying they are going to sale your property. i though u had to be 3 months behind before they could do that.
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8-07-2009 @ 12:38PM
Ginger said...
I have been trying to modify my current home loan with Chase so I can afford it due to losing almost everything including my business. Has anyone had success with this process and what was the time span and draw back to do this program.
( I did also have to go chapter 7 and was discharged last month) Should I just try to sell my home? and how with this market?
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8-10-2009 @ 6:23PM
Tim said...
yea the folks in washington aren't worried about the ones that make the economy work . All they're worried about is bailing all the big companies out so they can continue to give big bonuses to there top dogs just like washington the big dogs are only looking out for them not the working class people. look at the big money all the top dogs make have they offered anyone any help why don't they take a couple of million dollar a yerar cut. they are people losing there homes everyday and the sad thing is the kids are more important than a car dealership or a insurance company give the money to people that can really use it we could go back to using horses to travel on the cars are over-priced and arent worth the money you pay. bottom line is they need to wipe out everyones debt and then folks could have money to spend and then the economy would get strong and families could take vacations ect and things would be so much better for everyone but if you got back in debt the next time it would be on you. example 506 million in the usa the money they spent on the cash for clunkers was 3 billion there was the money to help every family in amercia. but no. they're not worried about the working folks.
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