81% of The People Starting To Face Foreclosure in The First Quarter of 2009 Were in Five States
Posted in General information on June 20th, 2009 by admin – Be the first to commentI came across some amazing statistics that I want to share with you today.
One website I monitor is www.realtytrac.com. RealtyTrac compiles statistics on the number of foreclosures and people facing foreclosure nationwide. They also track this by state, county, city and zip code.
RealtyTrac had an article about the number of foreclosures in the first quarter of 2009. In this article they broke down the foreclosures by state.
Typically a mortgage company starts to foreclose on a property when a person is three months behind on their mortgage payments. I decided to check out how many people started to face foreclosure in the first quarter of 2009 and what states had the majority of these.
RealtyTrac reported that during the first quarter of 2009 306,785 people nationwide entered the foreclosure process. Almost 81% of these were in five states. The breakdown is:
State Total PercentageNationwide 306,785Isn’t that amazing? 81% in five states. I then tried to figure out the reasons for this.
California 124,875 40.7%
Florida 70,114 22.9%
Nevada 20,534 6.7%
Illinois 19,848 6.5%
Ohio 12,279 4.0%
Total 247,650 80.7%
There seem to be two reasons for the high numbers in California, Florida and Nevada. The first is real estate value. The second is the unemployment rate.
California always has led the nation in the cost of homes. People who bought homes at their peak in value in late 2006 have seen the value of their homes drop far below what they paid for them. The unemployment rate in California is currently at 11.5%. When people who overextend themselves to buy a home suddenly lose their jobs and the value of their homes drop far below what they owe on these homes foreclosures jump.
In most areas of Florida real estate values jumped tremendously in 2004, 2005 and 2006. Many people bought thinking that they would make easy money on their investment. Then suddenly the bottom fell out. Values started to fall. People couldn’t sell the homes they bought. Couple that with an unemployment rate of 9.5% and you have a disaster.
In Nevada the values of homes skyrocketed from 2003 to 2006. The prices just went up faster than they should have. Here again people thought they would make a killing. So they paid far more than they should have for homes. Then the recession hit. The unemployment rate has jumped to 10.5%. Suddenly people found that they could no longer afford to make the monthly payments on the homes they had bought.
In Illinois and Ohio it looks like the main reason is unemployment. While home values had risen in both states, the increases were not as astronomical as they were in California, Florida and Nevada. In Ohio the unemployment rate is 10.1%. In Illinois it is 9.4%. Even many of the people who did not lose their jobs suddenly found their income reduced substantially. In both states people did not have enough savings to continue to tide them over. They could not make their mortgage payments when they lost their jobs or when their income was reduced.
I thought that you would find this as interesting as I did.
If you are facing foreclosure, try to remain positive. Take all the action you can to save your home. Explore all of the options open to you. You might want to check out my EBook. In it you will find ideas on how you can take charge of the foreclosure process.
Much Success,
Mark Elkins
