Report: Foreclosure in Washington State averages 390 days.
May 31, 2010 by Chief Editor
Filed under About, Blog, Featured, Housing, Market Direction/Analysis
An article in today’s New York Times business section discusses the foreclosure problem and how some owners are choosing to not pay their mortgages and live in their homes for months and even years. Florida is now averaging 518 days from the time the homeowner stops paying to the time of the foreclosure sale.
The graphic below shows the enormous backlog of homes in foreclosure working it’s way through the system and in Washington State the average time from default to the foreclosure sale is nearing 400 days. That is a long time to live without a housing payment.
While I’m not a fan of Wall Street crooks and bankers in general, I’m finding it very hard to resolve the growing phenomena of walking away from your mortgage because homeowners find themselves not being able to afford their payment.
Somehow they were able to afford the payment when signing loan documents, but today, all of a sudden the payments are no longer palatable. What happened since then? I’ll tell you. Serial refinancing. Where did the money go? Trips to Vegas, Cancun, Jamaica, cars, boats, 5th wheels, $250K custom coach motor homes, additional homes purchased as an “investment,” rolling consumer debt (credit cards etc.) into their home and on and on. – Editor, Snohomish Today.
From the article: More than 650,000 households had not paid in 18 months, LPS calculated earlier this year. With 19 percent of those homes, the lender had not even begun to take action to repossess the property — double the rate of a year earlier.
It may be premature to think that a housing recovery will miraculously turn-around from the Fall 2007 peak prices. To do so would have us witness the most amazing economic rebound in history. Emotionally, I want it to happen, but when you think through all the structural economic issues that have to mend both in the US and abroad, it may be more realistic to think of our economic wounds taking several years to heal. And, that excludes all the other problems going on outside and inside our borders.