Posted on April 6th, 2008 in Daily Mortgage/Housing News - The Real Story
Either 1) they don’t have the staff or 2) they don’t want the write-downs and are waiting for the big bailout. – Best, Mr Mortgage
Lenders Swamped By Foreclosures Let Homeowners Stay (Update1)
By Bob Ivry
April 4 (Bloomberg) — Banks are so overwhelmed by the U.S.
housing crisis they’ve started to look the other way when
homeowners stop paying their mortgages.
The number of borrowers at least 90 days late on their home
loans rose to 3.6 percent at the end of December, the highest in
at least five years, according to the Mortgage Bankers Association
in Washington. That figure, for the first time, is almost double
the 2 percent who have been foreclosed on.
Lenders who allow owners to stay in their homes are
distorting the record foreclosure rate and delaying the worst of
the housing decline, said Mark Zandi, chief economist at Moody’s
Economy.com, a unit of New York-based Moody’s Corp. These
borrowers will eventually push the number of delinquencies even
higher and send more homes onto an already glutted market.
“We don’t have a sense of the magnitude of what’s really
going on because the whole process is being delayed,” Zandi said
in an interview. “Looking at the data, we see the problems, but
they are probably measurably greater than we think.”