The Federal Housing Administration announced it will begin selling off distressed mortgages in bulk, which may help prevent foreclosures for thousands of home owners.
Filed under: News
By Matt Sledge
MIAMI — Sergio Palacios doesn’t have the typical South Florida foreclosure story.
He doesn’t live in a McMansion in some suburban subdivision. He wasn’t tricked into a mortgage he couldn’t afford. In fact, he doesn’t own a home at all. He’s a tenant. But for the last five months and counting, Palacios, an unemployed construction worker, has lived in his Liberty City apartment without running water.
Deutsche Bank filed a foreclosure suit against the property’s owners in April. As Palacios and his roommate suffered through illness and joblessness, they have slipped out to friends’ houses to drink and bathe when they could, and did without when they couldn’t.
On Tuesday, in a hearing that lasted less than nine minutes, Florida 11th Judicial Circuit Judge Gladys Perez ordered his water turned back on.
“Why are we here if we know the tenants are there?” she asked, a hint of irritation in her voice. Florida law prohibits landlords from simply cutting off utilities, a point which a lawyer for the apartment’s owners, Joseph Dolsan and Jean Mervoir, did not dispute.
“Let’s do it,” Perez continued, “let’s get the water back on.”
Palacios’s saga won’t end there. Dolsan and Mervoir have vowed to evict him. But his hearing on Tuesday illustrates one of the hidden undercurrents of the foreclosure crisis: tenants, many who have little or no income, caught in the middle of battles between banks and property owners.
Read the full story on HuffPost Miami.
Filed under: Foreclosures
Foreclosures have increased 14% between the second and third quarter of 2011, following five straight quarters where the number of foreclosures has gone down. This increase could dampen the recovery of the American housing market and harm economic recovery for cities where foreclosures rose significantly. Based on data recently released by RealtyTrac, 24/7 Wall St. has identified the 10 metropolitan regions where foreclosures increased by more than 30%.
The housing crisis that began half a decade ago is the cause of most of the foreclosures, even today. The bubble did not burst at the same time across the country. Many of the cities on this list were among the first to be hit. Eight out of the 10 metropolitan areas listed reached a peak median home value in the first quarter of 2006, after which they started declining. Most regions peaked toward the end of 2006, into 2007. This means the regions listed here have been declining longer than the rest of the country.
Because home values have been dropping in these areas longer than most other markets, they have generally also fallen further. In half of the regions on this list house prices have declined 50% or more since their peak. Home values in the Cape Coral-Fort Myers area, where foreclosures increased over 35%, have dropped by nearly 60% since the beginning of 2006, the seventh-greatest decline among any region in the U.S.
With a few exceptions, most of the cities listed are full of financially distressed and underwater homeowners – those whose homes are worth less than their mortgages. Six of the cities on this list are among the 20 cities with the largest portion of underwater homeowners. In the case of Fairfield-Vallejo, Florida, 53% of homes are in this position.
24/7 Wall St. used a RealtyTrac’s press release on quarterly rates to identify the 10 cities where foreclosures had increased the most between the second and third quarter of 2011. To illustrate other economic factors at play in these regions, we used unemployment rates from the Bureau of Labor Statistics and home price changes and median family incomes from Fiserv. Finally, 24/7 Wall St. also looked data from Corelogic on the cities with the highest percent of homes with underwater mortgages.
Most of these cities have high unemployment rates, low median family income and falling home values. These three forces combined suggest that foreclosures are likely to get even worse in these areas before they get better.
Click through the gallery to see the 10 cities where foreclosure rates are skyrocketing.