EVEN MORE BAD NEWS

Foreclosures: No relief in sight
July foreclosures nearly double from last year;
industry group raises forecast for more.

By Les Christie, CNNMoney.com staff writer
August 21 2007: 8:11 AM EDT

179,599 foreclosure filings, which include default notices, auction sale notices and bank repossessions, were reported nationwide for a 9 percent rise over the previous month and a 93 percent jump compared with July, 2006.

This past winter, RealtyTrac had forecast a 33 percent increase in U.S. foreclosures for the year but now it's raised its outlook. "It's trending to close to 2 million now, 60 percent more than last year," said Rick Sharga, RealtyTrac's vice president for marketing.

Moody's Economy.com is even more pessimistic with its forecast of some 2.5 million defaults for the year.

Housing prices: Steepest drop in 20 years
Aug. 28, 2007 (Thomson Financial delivered by Newstex) --

NEW YORK (AP) - U.S. home prices fell 3.2 percent in the second quarter, the steepest rate of decline since Standard & Poor's (NYSE:MHP) began its nationwide housing index in 1987, the group said Tuesday.

The decline in home prices around the nation shows no evidence of a market recovery anytime soon.

MacroMarkets LLC Chief Economist Robert Shiller said the declining residential real estate market 'shows no signs of slowing down.'

The index tracks the price trends among existing single-family homes across the nation compared with a year earlier .

A separate S&P/Case-Shiller index that covers 20 U.S. cities fell 3.5 percent from a year earlier. A 10-city index fell 4.1 percent from a year earlier.

Credit crunch means more foreclosures and much tougher loan terms
By John F. Wasik, Bloomberg News August 29, 2007


The credit crunch is not only making mortgage financing tougher, it will force more homeowners into foreclosure. The surge of more bargain homes on the market will further depress prices. Along with a corresponding pinch on home equity, auto loans, and credit cards, this pullback doesn't bode well for the economy.

In July alone, foreclosures almost doubled compared with a year earlier, according to RealtyTrac Inc., the Irvine, Calif., property tracking service. Hit hardest were those who were trying to refinance but couldn't obtain loans after their adjustable-rate payments rose. Also hurt are those homeowners refinancing loans who have no equity or money down.

The trigger point for what industry experts say will be the next wave of foreclosures is November -- when the next resets are scheduled -- and then in April of next year.

Mortgage resets: Record bill coming due
Billions in subprime ARMs will be subject to higher payments.
By Les Christie, CNNMoney.com staff writer
August 13 2007: 11:45 AM EDT

NEW YORK (CNNMoney.com) -- More than two million subprime adjustable rate mortgages (ARMs) are poised to reset at much higher rates in coming months, worsening an already suffering housing market.

Borrowers who took out hybrid ARMs in 2004 and 2005 to secure low "teaser" rates for the first two or three years of the loan may see their monthly mortgage payments climb by 35 percent or more.

"In October alone more than $50 billion in ARMs will reset," according to Mark Zandi, chief economist and co-founder of Moody's Economy.com. That's a record, according to Zandi.

Doug Duncan, chief economist for the Mortgage Bankers Association (MBA), is expecting as many as 600,000 home owners will get into trouble with perhaps half of them actually losing their homes.