Homes in Trouble

WASHINGTON -- As the state's economy slipped further into the doldrums, the number of Florida home loans entering foreclosure continued to rise at a rapid clip in the second quarter, with more than 78,000 new homes in jeopardy of being repossessed by lenders, according to an industry report released Friday.

The Mortgage Bankers Association survey, which tracks only first mortgages, painted a dark cloud over Florida's housing market after a more than half-decade of overbuilding and heavy speculation.

The percentage of Florida homes in foreclosure was higher than any other state in the nation as of June 30, standing at 6 percent, nearly double the national average. Nevada ranked second with 4.92 percent.

In all, more than 213,000 Florida properties were mired in the lengthy legal process in which a lender takes back title to a home for nonpayment of debt.
An additional 273,000 homeowners stumbled behind mortgage payments by a month or more, signaling a rough road ahead.

Problems in Florida and California, the two worst-hit states, drove up the national percentage of loans in foreclosure to 2.75, the highest rate in the survey's 39-year history. Only eight states topped the national rate.

Jay Brinkmann, chief economist for the MBA, said delinquencies in Florida and California were worsening and accounted for roughly three-fourths of the increase in foreclosures nationally between the first and second quarters of the year.

There is an indication that subprime foreclosures may have hit their peak in Florida. For the first time, the delinquency rate among borrowers with less than perfect credit in adjustable-rate loans dipped slightly between quarters from 19.71 to 19.31. However, about 29 percent of the state's subprime adjustable-rate loans were in foreclosure, representing about 92,000 properties.

Source: http://www.miamiherald.com/business/real-estate/story/673471.html