Courtesy of Nomi Prins
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As anyone not working in economic leadership in Washington knows, the housing market has not stabilized and foreclosures, along with the pain they cause, remain unnecessarily high with no real signs of abatement. There remains no federal legal requirement for banks to renegotiate mortgages in a fair and quick (or any) manner, nor, sadly, will there be. As I’ve mentioned many times before, much of the mortgage pain could have been reduced using federal bailout money (or any of the more than $4 trillion of excess reserves, treasuries, and mortgage assets on the Fed’s books) to forcibly reduce mortgages, rather than being given to sustain the banks that created them and are sitting on devalued assets (the homes) the loan risk for which, they continue to shove onto borrowers, that don’t have access to 0-.25% money.
This troubling report came out yesterday from RealtyTrac. It basically states that the reason foreclosure figures are at 40 month lows, is because banks are just backed up with all their foreclosure activity, and the growing pace of delinquent mortgages that banks ultimately turn into foreclosure proceedings. In other words, they are just too busy screwing their borrowers to screw them more quickly.
"Nationwide, foreclosures completed (REOs) in the first quarter of 2011 took an average of 400 days from the initial default notice to the REO, up from 340 days in the first quarter of 2010 and more than double the average 151 days it took to foreclose in the first quarter of 2007.
The average timeframe from initial default notice to REO in New Jersey and New York was more than 900 days in the first quarter of 2011, more than three times the average timeline in the first quarter of 2007 for both states. The average foreclosure process in Florida took 619 days for foreclosures completed in the first quarter, up from 470 days in the first quarter of 2010 and nearly four times the average of 169 days it took in the first quarter of 2007. The average foreclosure process in California took 330 days for foreclosures completed in the first quarter, up from 262 days in the first quarter of 2010 and more than double the average of 134 days in took in the first quarter of 2007."
in practice, that means that people fighting foreclosures do so at greater legal costs drawn out over longer, more painful time periods. It also means banks are lying about their true conditions – but, that’s nothing new. Even as investigations into mortgage practices, such as the one just announced by New York Attorney General, Eric Schneiderman, continue, the glacial pace of inspection compared to the intense devastation afflicting borrowers, provides little comfort, though hopefully some light at the end of a really arduous tunnel.
Pic credit: Jr. Deputy Accountant
