Foreclosures Hit Record High

According to the AP, foreclosures and late payments are hitting a record highs, with the number of people losing their homes in the first three months of the year being a record. Unfortunately, it’s a reinforcing cycle as people scramble to recapture equity, selling their homes, and exacerbating the problem.

Nearly 1 percent, or roughly 447,723 loans, fell into foreclosure during the January-to-March period, the Mortgage Bankers Association said Thursday in its quarterly snapshot of the mortgage market. That surpassed the previous high of 0.83 percent over the last three months in 2007.

It only gets worse when it comes to late payments:

The report also found that more homeowners slipped behind on their monthly payments. The delinquency rate jumped to 6.35 percent — or 2.87 million loans — compared with 5.82 percent for the previous three months. Payments are considered delinquent if they are 30 or more days past due

This underscores the need to talk to your lender if you foresee problems. Banks don’t want to foreclose, they are certain to lose money, they’d much rather limit the damage and make deals.