Foreclosures up 30 Percent in February

Conditions in the housing and mortgage markets continue to fester and in my view continue to underscore the fact that until the housing market stabilizes efforts to stimulate the economy will not bring the desired results. Not only are foreclosure rates up, but the number of homeowners who now owe more than their homes are worth continues to grow as foreclosures further depress property values (at a CLE seminar yesterday on foreclosure and bankruptcy issues, it was noted that Virginia is now in the top 10 states with the number of homes with negative equity). Between fear on the part of buyers that they may pay too much for a home and mortgage lenders that are not making loans even to good credit risks - despite receiving billions in tax dollars - I don't see a turn around anytime soon (personally, I believe lenders who received bailouts that have not used the funds to make new loans should be compelled to return the funds). We are truly continuing to reap the whirlwind of the GOP mantra that marketplace greed is good and regulation is bad. Here are highlights from the Virginian Pilot:

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WASHINGTON (AP) -- Despite halts on new foreclosures by several major lenders, the number of households threatened with losing their homes rose 30 percent in February from last year's levels, RealtyTrac reported Thursday.

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Nationwide, nearly 291,000 homes received at least one foreclosure-related notice last month, up 6 percent from January, according to the Irvine, Calif-based company. While foreclosures are highly concentrated in the Western states and Florida, the problem is spreading to states like Idaho, Illinois and Oregon as the U.S. economy worsens.

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The rise in foreclosure filings came despite temporary halts to foreclosures by Fannie Mae and Freddie Mac, and major banks JPMorgan Chase, Morgan Stanley, Citigroup and Bank of America. Those companies pledged to do so in advance of President Barack Obama's plan to stem the foreclosure crisis, which was launched last week.

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Nearly 12 percent of all Americans with a mortgage - a record 5.4 million homeowners - were at least one month late or in foreclosure at the end of last year, according to the Mortgage Bankers Association. That's up from 10 percent at the end of the third quarter, and up from 8 percent at the end of 2007.

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Nevada, Arizona, California and Florida had the nation's top foreclosure rates. In Nevada, one in every 70 homes received a foreclosure filing, while the number was one every 147 in Arizona. Rounding out the top 10 were Idaho, Michigan, Illinois, Georgia, Oregon and Ohio.