Cities such as Miami, Phoenix and Las Vegas that have very high foreclosure rates and where properties have declined by half of their peak values, had some of the largest declines in new mortgage payment delinquency rates, as recently reported by the Mortgage Bankers Association. These declines may possibly indicate an upcoming gradual end to the foreclosure crisis, despite the fact that, at present, there is still a large problem.
Many banks are putting off starting the foreclosure process, which usually takes between 4 and 6 months, as they see if they are able to work with their borrowers via the Obama administration's mortgage relief program, which enables borrowers to lower their payments to a low as 2% for up to 5 years and extends the loans up to forty years. Meanwhile, experts are claiming that borrowers in the hundreds of thousands are either ineligible or will not complete the program's process. According to Barclays Capital, this may result in approximately six million homes that have been foreclosed upon being put on the market in the next 3 years. A gradual, rather than a sudden placing of these homes on the market by banks would be less detrimental to the housing market.
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