Home Foreclosure Notices Continue To Rise

Irvine, CA, March 12, 2009--The number of households threatened with foreclosure rose 30 percent in February from last year's levels, RealtyTrac said.

Nearly 291,000 homes nationwide received at least one foreclosure-related notice in February, up 6 percent from January. While foreclosures are highly concentrated in the Western states and Florida, the problem is spreading to states like Idaho, Illinois and Oregon.

"It doesn't bode well," for the embattled U.S. housing market, said Rick Sharga, vice president for marketing at RealtyTrac, a foreclosure listing firm. "At least for the foreseeable future, it's going to continue to be pretty ugly."

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.

Two states contributing to the increase were Florida and New York, where temporary bans on foreclosures ended.

But other states are moving to enact similar measures. On Wednesday the Michigan House approved legislation that would give homeowners facing foreclosure a 90-day reprieve. The legislation now goes to Michigan's Republican-led Senate, where its future is unclear.

While the number of foreclosures continue to soar nationwide, banks have held off listing properties for sale, Sharga said. There were around 700,000 such properties nationwide at the end of last year, making up a "shadow inventory" of unsold homes that could drag the housing crisis out even longer.

"It's going to take us longer than you might anticipate to burn through he inventory of distressed properties," he said.

The results highlight the challenge ahead for Obama and his economic advisers. The Obama administration is aiming to help up to 9 million borrowers stay in their homes through refinanced mortgages or loans that are modified to lower monthly payments.

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.

The RealtyTrac report said more than 74,000 properties were repossessed by lenders in February.