Sunday, October 3, 2010

Economic Woes ahead? HOUSING: Foreclosures poised to rebound

HOUSING: Foreclosures poised to rebound: "Disclosures last week that some major lenders had suspended foreclosures could delay, but not prevent, a wave of property seizures as lenders review their procedures. If foreclosure rates jump as predicted, the increased supply of lower-cost homes could push down overall prices in the area. Such a dip could endanger the fragile economic recovery.
Government-controlled lenders, which own or guarantee 50 percent of all U.S. home loans, have made changes to some rules, and have sent out pointed reminders to lenders that shorten the leash on homeowners unwilling or unable to pay their mortgages. Already, some housing counselors and economists have seen signs of the new hard-line approach.
'Distressed sales are going to increase to record levels next year,' said Wayne Yamano, an economist with John Burns Real Estate Consulting in Irvine. 'What’s really interesting is it's coming from top down. Fannie (Mae) and Freddie (Mac) are starting to issue a lot more foreclosure starts, and banks typically take their lead.'
The two government-controlled lenders, Fannie Mae and Freddie Mac, have been part of a major effort for the last few years to stem the tide of foreclosures nationally."

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