Florida Foreclosure Rate Ranks 4th

Things are certainly getting hotter in Florida. With half of the year almost gone, the number of foreclosure filings for this state is still not letting up. According to RealtyTrac, there were 25, 736 filings for May, which is 6 percent higher than the number of foreclosure filings last April.

Florida has consistently been among the Top 5 states with the highest foreclosures rate ever since the subprime mortgage mess exploded. Many experts have blamed speculative buying as reason why there are literally hundreds of thousands of foreclosure homes in Florida.

Speculative buyers grabbed properties they could not afford during the last housing boom. When housing market conditions started getting bad due to relaxed underwriting guidelines and aggressive lending practices, they simply abandoned these homes and left. It does not help that most homeowners are struggling with their mortgage payments due to rising consumer debt and prices of commodities and fuel.

Nationwide, the number of foreclosure filings increased by 7 percent from April and 48 percent from May last year. There were a total of 261,255 homes that entered some stage of foreclosure. This translates to one out of 483 homes. So far, this is the highest foreclosure rate ever recorded by RealtyTrac since January 2005.

As more foreclosure filings are recorded each month, the entire industry is worried about home prices declining further. In addition, home sales have also been sluggish, primarily due to buyers who are waiting on the sideline and hoping for the lowest possible prices.

Although there are some states which are not as severely affected as Florida and California, the overall picture looks pretty grim. Unless the federal government increased its efforts to curb foreclosures, you can expect more homeowners losing their homes to foreclosure in the coming months. At present, troubled homeowners, together with their lenders, are looking into the loan modification option as a way to stop foreclosure.

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