Despite making wise financial decisions, most homeowners still face foreclosure

[Joanne98]

A large number of Americans who defaulted on their mortgage loans fell behind as a result of the subprime mortgage crisis and increasing debt. However some homeowners are facing foreclosure not as a result of predatory lending or unpaid credit card balances, but because of unrelenting economic conditions.

Nearly 2.4 million homeowners purchased affordable homes at standard mortgage rates, but are now finding themselves unable to keep up with falling home values and factors such as unemployment, according to the Christian Science Monitor. These types of consumers find themselves in a catch-22 - they are unable to maintain payments due to prolonged unemployment but are prevented from selling their house because they owe more than its worth.

Citing estimates from the Center for Responsible Lending, the Monitor reports that 9 million Americans are at risk of losing their home to a foreclosure between 2009 and 2012.

"In the next 12 months it's going to be tragic - most people are just starting to fall behind now," Boston attorney Avi Liss told the Monitor.
http://www.credit.com/news/credit-debt/2010-07-17/despite-making-wise-financial-decisions-most-homeowners-still-face-foreclosure.html

Get ready for the foreclosure Armageddon. It's right around the corner.

[napi21]

1. I'm sure that's true, but I still believe that too many people

were convinced that home values never decline so they paid way too much for their house to begin with. I know when I saw the homes that were selling for $200,000 $250,000 I would never have bought one! The house justwasn't worth it! When you see anything that gains 30 to 50 % or more in value in a year, stay away!

A friend of ours bought a house in California about 5 years ago. Paid $350,000 for it. It's now valued at $235,000 and his mtg. is $290,000. He's fortunate, sort of, that he was transferred and he's renting his house for an amunt that covers his mtg. payment. He's assuming the house will regain it's value to near what he paid for it and then he'll sell. He thinks this will happen in about 5 years. I wish him lck, but I'm not so sure he's right.

[dana_b]

2. scary times

This is happening to my family too. My sister and her husband bought a small condo for themselves and their kids with a good down payment, a 20 or 25 year loan, no increasing APR - everything like you are supposed to do. Now thet just had to sell their business, he lost his job and now they may face foreclosure. I keep hearing how things are getting better with jobs and the economy. Well, I can't see the times getting better for our family but I sincerely hope it is for others.

[MineralMan]

3. Well, I'm not sure it's "most" people, but certainly it's a really

serious issue.

[proud2BlibKansan]

4. "Most" homeowners?

That's kinda misleading.