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New Jersey Foreclosure Homes – A Study

The Federal Reserve Bank of New York released a study on 08/04/2008 that has painted a very stark picture of New Jersey’s sub-prime mortgage crisis.

The ratio of New Jersey’s sub-prime mortgages in relation to homes being foreclosed is the country’s fifth highest.

One of the findings of the study observes that the New Jersey foreclosure homes crisis is not evenly distributed between different strata of homeowners in the state. A majority of the sub-prime foreclosure homes in New Jersey are in zip codes belonging to urban areas. This has caused specific neighborhoods with moderate incomes to suffer financial pain.

The study went on to say that for every thousand homes in New Jersey, there were three foreclosure homes belonging to the sub-prime market and also that within each county, these were neighborhoods where the residents had household incomes which were lower than in other parts of the county.

New Jersey currently has in excess of 3.47 million homes. At the end of June more than 10,446 foreclosure homes in New Jersey were on sub-prime mortgages.

The study also found that between Essex and Union existed 25%, the highest share, of the sub-prime foreclosure homes in New Jersey.

In Essex 1,127 mortgages, which account for about 75% of the sub-prime loans in foreclosure, are mainly in 11 of the total of 31 zip codes in the county. The 11 zip codes belong to Newark, Irvington,Bloomfield, Orange, West Orange and East Orange.

With them put together for every thousand homes in these eleven areas, there were 6.7 New Jersey foreclosure homes belonging to the sub-prime market. The state average is less than half of this.

A bleaker picture is presented in Union County, with 789 mortgages, which account for a majority of the sub-prime loans in foreclosure, mainly in 8 of the total of 26 zip codes in the county. The 8 zip codes belong to Union, Roselle, Plainfield, Linden, Hillside and Elizabeth.

With them put together for every thousand homes in these eight areas, there were 8.1 foreclosure homes belonging to the sub-prime market.

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