Law Offices of Lance Denha Discuss the Impact of the New Foreclosure Wave to Hit Everyday Borrowers

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The Law Offices of Lance Denha explains, that while Subprime loans caused the initial foreclosure wave, that now, job losses, economy will create a bigger run

Recent statistical data released by RealtyTrac signals a change in the type of homeowners now being affected by foreclosure. While Subprime loans prompted a foreclosure boom earlier this decade, it is widely expected that continued job loss and the overall economy appears to have manifested itself into another foreclosure wave for struggling homeowners. Foreclosures now are a direct result of the difficult economic times homeowners are suffering from ,as detailed by founder Michael Redman.

Half a decade into the deepest U.S. housing crisis since the 1930s, many Americans are hoping the crisis is finally nearing its end. RealtyTrac reported that house sales are picking up across most of the country, the plunge in prices is slowing and attempts by lenders to claim back properties from struggling borrowers dropped by more than a third in 2011, hitting a four-year low.

An abundance of U.S. homeowners face the prospect of losing their homes to foreclosure this year as banks continue to process foreclosures across the nation, whether it be via judicial and non judicial process used in the United States. "We are right back where we were two years ago. I would put money on 2012 being a bigger year for foreclosures than 2010," said Mark Seifert, executive director of Empowering & Strengthening Ohio's People (ESOP), a counseling group with 10 offices in Ohio."Last year was an anomaly, and not in a good way," according to Seifert.

As reported by ABC News in 2011, the "robo-signing" scandal, in which foreclosure documents were signed without properly reviewing individual cases, prompted banks to hold back on new foreclosures pending a settlement. As a result of the robo-signing scandal, the Attorney General in all 50 states, in some capacity, investigated such scandal and, as a result, the five major lending institutions involved agreed to a settlement in which lenders involved are to pay over $25 billion to households at risk to foreclosure. Despite this settlement, expert analysis of the market continue to point towards signs that the pace of foreclosures is picking up again, something housing experts predict will again weigh on home prices before any sustained recovery can occur. “Now that the banks have a settlement, foreclosure numbers for 2012 are going to be high,” said NEDAP co-director Josh Zinner. According to leading broker dealer Amherst Securities, some 9.5 million homes are still at risk of default and in February it said it expected to see the uptick in foreclosures start to hit in April and May.

RealtyTrac noted that while the initiation of the foreclosure process by lenders and servicers were more than 50 percent lower for the same period in 2010, those begun by Deutsche Bank were up 47 percent from 2011. Those of Wells Fargo rose 68 percent and Bank of America loans, including BAC Home Loan Servicing, jumped nearly seven fold, 251 starts versus 37 in the same period in 2011. This trend clearly points to the fact that the major lending institutions held off in 2011 and are seeking to expedite the foreclosure process of defaulting homeowners in 2012.

Online foreclosure marketplace RealtyTrac estimated that while foreclosures dropped slightly nationwide in February from January and from February 2011, they rose in 21 states and jumped sharply in cities like Tampa (64 percent), Chicago (43 percent) and Miami (53 percent). RealtyTrac CEO Brandon Moore said the “numbers point to a gradually rising foreclosure tide as some of the barriers that have been holding back foreclosures are removed.”

To reiterate as previously stated, the major difference in the early years of the housing crisis, which was dominated by Americans saddled with the most toxic subprime products - with high interest rates where banks asked for no money down or no proof of income - is that in today’s market, the foreclosure is a direct result of the difficult economic times homeowners are suffering from.

“The subprime stuff is long gone,” said Michael Redman, of “Now the people being affected are hardworking, everyday Americans struggling because of the economy.” Lance Denha, Esq. of the Law Firm of Lance Denha noted that “The new face of the U.S. housing crisis is the middle class, suburban or rural with a conventional 30-year mortgage at a reasonable interest rate, but is unemployed or underemployed.” Although the national unemployment rate has fallen to 8.3 percent from its peak of 10 percent in October 2009, nearly 13 million Americans remain jobless, meaning many more are struggling to keep up with their mortgage payments.

Real estate company Zillow Inc. says more than one in four American homeowners were “under water” or owed more than their homes were worth in the fourth quarter of 2011. The crisis has essentially wiped out some $7 trillion in U.S. household wealth. Zillow expects the resurgence in foreclosures this year, combined with excess inventory of unsold, bank-owned homes will contribute to a 3.7 percent national decline in prices before the market hits bottom in 2013 and stays there until 2016. Unfortunately, getting through the remaining foreclosures and dealing with the resulting flood of homes on the market in the wake of the bank settlement is a necessary part of the healing process for the U.S. housing market.

The Law Office of Lance Denha P.A. is committed to ensure that every possible avenue is pursed so that the homeowner’s legal rights are preserved. Actively monitoring the ever changing landscape of foreclosure laws, recent foreclosures across the nation as well as state imposed rules and procedures associated with foreclosure, is vital to ensure and protect these rights. The Law Office of Lance Denha P.A. is a multistate law firm and helps legally defend wrongful foreclosures against homeowners and utilize any and all legal tactics available to help accomplish preserving homeowner’s rights. For further information or assistance, please call at 954-840-0770.

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