An Uncertain Future by ProQuest


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									                                                                  credit world
                                                                                            By Emily Grace

An Uncertain Future
While consumer confidence is improving, the housing market still faces several significant challenges in 2010

W             ith both mortgage
              delinquencies and
              foreclosure filings hitting
record highs in 2009, there will likely be
a considerable volume of foreclosures
                                             number of properties receiving at least
                                             one foreclosure filing during the year
                                             makes up 2.21 percent of all housing
                                             units. This percentage is up from 1.84
                                             percent in 2008, 1.03 percent in 2007
                                                                                            and expansion of the homebuyer tax
                                                                                            credit is also stimulating the housing
                                                                                            industry. The Worker, Homeownership
                                                                                            and Business Assistance Act of 2009,
                                                                                            signed into law Nov. 6, 2009, extended
this year. Because the timeline of an        and 0.58 percent in 2006.                      the tax credit of up to $8,000 for
economic recovery is unpredictable, the          “As bad as the 2009 numbers are,           qualified first-time home buyers
housing and mortgage landscape for           they probably would have been worse if         purchasing a principal residence and
2010 remains just as uncertain.              not for legislative and industry-related       authorized a tax credit of up to $6,500
                                             delays in processing delinquent loans,”        for families that have lived in their
Delinquencies                                Saccacio said. “After peaking in July…         homes for at least five years and wish to
    According to the December 2009           we saw four straight monthly decreases         purchase a new home. The credit
Mortgage Monitor Report released by          driven primarily by short-term factors:        applies to homes purchased or under
Lender Processing Services, one in           trial loan modifications, state legislation    contract by April 30, 2010.
every 7.5 homeowners in the United           extending the foreclosure process and
States is either behind on mortgage          an overwhelming volume of inventory            Economic Factors
payments or in foreclosure.                  clogging the foreclosure pipeline.”               The Economic Advisory Committee
    Total delinquencies, excluding                                                          of the American Bankers Association
foreclosures, increased to a record high     Government Initiatives                         predicts the annualized inflation-
of 9.97 percent of all loans in December,       The Home Affordable Modification            adjusted real GDP growth rate will be
representing a month-over-month              Program (HAMP) is designed to reduce           approximately 3.1 percent throughout
increase of 5.46 percent and a year-over-    delinquent and at-risk borrowers’              201
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