12% of American Homeowners Behind on Mortgageby Tim Manni
By the end of 2008, 12% of American homeowners were at least one month behind on their mortgage or had entered into foreclosure according to the Mortgage Bankers Association. The stat jumped 10% from the third quarter of 2008, and up 8% from the end of 2007. The numbers for subprime and adjustable rate borrowers are even worse:
A stunning 48 percent of the nation’s homeowners who have a subprime, adjustable-rate mortgage are behind on their payments or in foreclosure, and the rate for homeowners with all mortgage types hit a new record, new data Thursday showed.
But that’s not the worst of it.
The reckless lending practices in states like Florida, California and Nevada that were the epicenter of the are no longer driving up the nation’s delinquency rate. Instead, the foreclosure crisis now is being fueled by a spike in defaults in states like Louisiana, New York, Georgia and Texas, where the economies are rapidly deteriorating and thousands are losing their jobs.
At this point it’s hard to tell how many of these “risky” borrowers will benefit from President Obama’s loan modification portion of his Homeowner Affordability and Stability Plan which is focused on “responsible” borrowers.