Homes  not yet in foreclosure still at risk

Mortgage crisis needs attention from Congress, commissioner says

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By Tim Tresslar, Staff Writer 5:49 PM Saturday, August 22, 2009

While the state and local housing markets have shown some signs of stabilizing, a pair of recent reports indicate that more than 1 million mortgage loans in Ohio remain at risk.

According to a report by First American CoreLogic, nearly 862,000 mortgages in Ohio had negative equity, meaning the borrower owes more on the house than it’s worth. When counting property loans hovering within 5 percent of the negative-equity mark, the number of troubled loans exceeds 1 million, according to First American.

Of the 15.2 million mortgages with negative equity, five states — including Ohio — accounted for 47 percent of the negative equity. California and Florida together accounted for about 5.2 million or 35 percent, followed by Ohio, Texas and Arizona.

A second report, this one released Thursday, Aug. 20, by the Mortgage Bankers Association, indicated borrowers who were late on payments but not yet in foreclosure in Ohio grew to 9.8 percent in second quarter 2009, compared with 8.7 percent in the first quarter. The number of Ohioans with loans that were delinquent or already in foreclosure also increased.

Bill Faith, executive director of the Coalition on Homelessness and Housing in Ohio, said the reports show many homeowners continue to find themselves in a vulnerable position, one where a small increase in unemployment could push tens of thousands into foreclosure.

“I found both of the reports to be pretty alarming,” Faith said. He added that passage of House Bill 3, which would put tighter rules on those who service mortgages and set a moratorium on mortgages, would help stabilize the situation.

However, Mark Fleming, a chief economist for First American, in a statement said it’s possible the negative-equity loans peaked during the second quarter, because decreases in home prices have moderated or flattened.

“However, until negative equity recedes and unemployment declines, mortgage risk will continue to be very elevated,” Fleming said.

Staff writer Tim Tresslar covers commercial and residential real estate for Dayton Daily News. His Real Estate Notebook appears every Sunday. He can be reached at (937) 225-7317 or via e-mail at ttresslar@coxohio.com.

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Mr. Tresslar, Did you really want to say that house bill 3 would put a moratorium on mortgages, or did you mean house bill 3 will put a moratorium on mortgage FORECLOSURES? Who edits this? Will anyone at the DDN address the millions that will be extorted with issue 3 from lenders by county commissions and non profits such as Mr. Faith's organization?

what?
6:27 PM, 8/23/2009

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