Representatives and executives with the MBA (Mortgage Bankers Association) have stated that unemployment has replaced subprime ARM mortgages as the main reason for foreclosures, which are not expected to see a decline until sometime in 2010.
The chief economist with the MBA has predicted that unemployment will continue to rise through the fourth quarter of 2010. This would have a direct negative impact on the foreclosure rate in the country.
On a more positive note, originators of new loans have had cause to celebrate lately as the decline in mortgage rates has fueled a boom in the generation of new loans. For the coming year, applications for refinancing are expected to lighten up as mortgage rates increase. A forecasted increase of 12% in loans for the purchase of homes is predicted, but overall volume of mortgages is anticipated to decrease from around 2 trillion dollars this year to one and a half trillion dollars in the coming year.
Levels of customer service throughout the industry have suffered due to the overwhelming amount of delinquencies and the demand for loan modifications.
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