Millions of homeowners attempting to secure a loan modification for themselves face the disheartening situation of having a home that is underwater. If you’ve ever experienced the sensation of drowning, you know that it’s entirely frightening. Having that burning, desperate need to take in a gulp of air when you find yourself surrounded only by water – it’s a terrifying reality to have to come to terms with. Until you have access to the room you need to breath, nothing else is more critical. What I’ve just described is a fitting metaphor for the way numerous homeowners across the United States are feeling.
According to new figures released by Zillow.com, almost 30% of all American homeowners now owe more on their homes than the properties are actually worth (Zillow is a website that tracks real estate trends and statistics). What this means is that the numbers of defaults and foreclosures in America are practically guaranteed to increase further. More and more homeowners are choosing to simply walk away from their mortgage commitments rather than remain burdened by suffocating payments which have lost all investment potential. When homes cannot be sold or refinanced, many take the step to turn their back on the problem.
The rate of foreclosures is now double what it was reported to have been a year ago, while the number of homeowners who have failed to make a home loan payment for two months or more has risen for the first time following 2009. While speaking to MSNBC.com, head Zillow economist Stan Humphries stated that the US housing market really is in unexplored waters. More than 25% of all homes are now officially underwater, while the unemployment rate stubbornly sits at the 9% mark. Further foreclosures are simply inevitable.
Humphries went on to say that the increase in the existence of underwater homes has come about due to the massive backlog in foreclosures that still exist in the country. Last year many lenders were accused of pursuing foreclosure proceedings by ‘robo-signing’ the documentation (the illegal practice of having foreclosure documentation processed by unqualified people, without appropriate reviewing). Because of this scandal, they quit their foreclosure strategy for a little while, and consequently, foreclosures are taking longer to finalize and foreclosed properties are taking a longer period of time to sell. This is more true in some parts of the country than in others. Cities like Tampa and Sacramento now have more underwater homes in them than not. This is a staggering thought.
Zillow has also concluded that the values of properties are still falling, down by a level of 4.4% when compared to the same period in 2010. In addition, foreclosures on delinquent home loans have nearly doubled since a year ago, based on the latest figures from Fitch Ratings. The increased foreclosure levels means that housing values in the United States will most likely plummet another 10% before reaching a stable position, according to the ratings agency. Fitch has stated that the rate of foreclosures on delinquent mortgages has increased to more than 10% a month. This represents nearly double the ground-breaking low levels from 12 months ago.
Then again, if you’re a homeowner in this country who is trying seemingly in vain to figure out a way to save your home, no-one needs to tell you that the housing market in the U.S. is in dire straits. It’s a reality that you are having to cope with on a daily basis. The burden you carry is very real, and it is one shared by millions of Americans throughout the country. Increasingly, struggling homeowners are speaking out about the pain and hardship that they are encountering as they endeavor to save their home from foreclosure.
Join the discussion today and make your voice heard. You can do so by sharing your story with us on Twitter, Facebook, or Mycaal.com. All hope is not lost, and saving your home and your dream through loan modification remains a very reachable goal.
About Carla Ghosn
|CEO and Founder of MyCaal keen on helping American homeowners save their home. If you need help with your loan modification, visit www.mycaal.com to get help on pre-qualifying your loan for approval, as well as preparing and printing your loan modification package online.|