BANKS, OVERWHELMNED, NOT FORECLOSING

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.''

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http://www.bloomberg.com/apps/news?pid=20601109&sid=aOluOO8Vy0gc&refer=home

    

Comments

[Edward Koller]

First viewing of Mr Markets u-tube video, outstanding, for the truth to be spoken. My hats off to Mr. Market. Keep us informed as we desend into the next depression. Ed