Bank Officials Across the Country are Expecting a Flood of Foreclosures

Posted on January 7, 2009
Filed Under Foreclosure Homes | Leave a Comment

Now that the holiday season is grinding to an end, bank officials across the country are expecting a flood of foreclosures. This season the lenders had responded to the crisis by putting on hold foreclosures during the holidays. But now that the grace period is over the banks are getting ready to foreclose on delinquent borrowers.

Analysts noted a 9% decline in foreclosure numbers during November after increases in the previous two months, in Florida. The state ranks second in foreclosure rates. It seems 2009 will mime the previous year with Marion County being one of the worst affected regions.

Tim New of People’s First Community Bank said, “I think it’s going to be an avalanche (of foreclosures) in the future. The bank bailout with no strings attached has been a real hoax. (Interest rates) have come down but it’s not helping.” The financial strain on many families has become acute. To them, credit rating right now is of no consequence. This attitude is pivotal for them to continue to hold on to their houses. He added, “There are going to be so many people with ruined credit, people won’t care anymore. Credit isn’t important anymore.” The foreclosure victims have started to say that they do not care and will just return the property to the bank. Some do not want to bother about even that – they will just walk away.

Those who had invested in property for the sake of speculation are most likely to shrug and walk away without bothering about the mortgage.

During the first week of December the lenders of Florida had agreed to put a hold on foreclosures voluntarily for 45 days. They extended it for the entire holiday period after Governor Charlie Crist stepped in with the threat of a mandatory executive order to that effect. The foreclosure freeze will come to a close around the middle of January.

For Florida the New Year looks grim. The foreclosure rate is 1:173 as it ranks just after California according to RealtyTrac.

The foreclosure problem being challenging in more ways than one it is difficult to find one silver bullet to put an end to it. New opines that the government should help to put on hold foreclosures for those people who are somewhat able to continue with mortgage payments. The real problem, he says, is the problem of unemployment. Without jobs how can mortgages be paid?

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