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What You Need to Know About the Current Home Foreclosure Crisis

The foreclosure crisis has reached an all time high all over the U.S. as evidenced by the number of foreclosure properties. The rates have increased by 25% from last year. Nevada foreclosures remain the highest in a devastating 22 consecutive months from last October. This means that in 74 homes, one receives a foreclosure notice –a lot more than the national average.

Arizona foreclosures are next to Nevada with a 35% increase in their foreclosure rate from the month of September and 176% from last year. Not far behind are the rates of Florida foreclosures as it rank third to the highest with a rate increase of 13% from the month of September and 80% a year back.

The housing boom was supposed to enhance the housing market by lending even to those who are considered as risky borrowers. Analysts said that the program has instead resulted to more foreclosures. This was due mainly to the fact that more and more residents can no longer pay their mortgages because jobs are being lost due to the economic downfall. Also, since home values are dropping, many houses can no longer be sold at a price that is higher than the mortgage.

The big names in the housing market decided to step up and help the residents who are in need. CitiGroup selects residents who are in a financial fix and contacts them to offer an alteration to their mortgage. The alteration is a lot easier way for the residents to pay their mortgages. Freddie Mac and Fannie Mae also help residents who are spending 38% of their income to pay their mortgages.

Even so, there are legislator who argue that mortgage lenders are not doing everything that they can to do something about the foreclosure crisis. According to the Bank of America, the problem begins when the lenders do servicing because mortgage alterations are simply not allowed.

Although a solution to the rising number of foreclosures is still not clear, residents can still do something if they are in a financial fix and have foreclosure problems. They can contact their loan servicing bank and ask for assistance or alternative solutions.

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• More Credit Card Defaults in States Hit Hard by Foreclosures
• Foreclosure Alternatives: Are They There Only to Forestall the Inevitable?
• Turning Crisis into Silver: Foreclosure Homes Attract Investors
• 3Q Foreclosure Filings Soar 71%