The Wall Street Journal overviews a series of studies on foreclosures, mortgage modifications and home prices.
Of 7.7 million mortgages behind in payments, they are estimating 5 million will end up in foreclosure, in spite of home mortgage modifications.
most efforts to modify loans with easier terms will delay, not prevent, the loss of homes to foreclosure
It's also fairly pocketed in certain areas. The top cities are listed below, along with their months of shadow inventory. Shadow inventory, because it's not on the actual market, can temporarily raise home prices due to less supply available. Yet that unsold inventory is waiting in the wings. It is actually being kept off the market through other means.
90 percent of all new home loans are funded or guaranteed by taxpayers
taxpayers are on the hook for most of the loans that are still being made if they go bad. And they are also on the line for any losses in the massive portfolios of old loans at Fannie Mae and Freddie Mac, which own or back more than $5 trillion in mortgages.
Gets better. WaPo is reporting a high risk of default (Are we surprised with a 9.7% official unemployment rate?)
There is growing evidence that many loans being guaranteed by the government have a significant risk of defaulting. Delinquencies are spiking. And the Federal Housing Administration, another source of government support for home loans, is quickly eating through its financial cushion as losses mount.
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