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 October 21, 2007

Risk of Foreclosure Rising, But Only in Some Areas
According to a report produced by First American Core-Logic, the rising risk of foreclosure still persists, yet it tends to be concentrated in regions of the country that have a souring economy, or in areas where a large number of homes were financed with subprime mortgages.
Mark Fleming, chief economist reports that the Core mortgage Risk Index increased by 1.6% from the 3rd quarter of this year. The good news is that this increase reflects a slower rate of growth than earlier this year.

Fleming states that the findings illustrate that the majority of the anticipated increase in foreclosures will not be felt nationwide. Unfortunately, the burden will fall on parts of the country where downturns in local economies have caused layoffs.

Fleming continues by stating that for example, in the Detroit market- the riskiest mortgage market- the type of mortgage that a home owner holds does not make any difference if the home owner does not have a weekly paycheck coming in.

In contrast to this situation, Fleming states that rising foreclosure rates in Florida and California are the result of correcting home prices.

On the whole, less than 2% of all mortgage borrowers are at risk of filing foreclosure. In a majority of the home prices in the United States are stable, increasing along with the rate of inflation.

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