FALSE HOME SALES REPORTS SHOW HOMES SELLING; BUT 1 IN 3 SALES IS THAT OF A FORECLOSED HOME WHICH DOES NOT SPUR THE ECONOMY AT ALL!!

The entire home ownership concept in America is drastically changed. The push for Americans to own homes( with a good chunk of illegal aliens getting loans as well) has come to a screeching stop!

It has been reported that one out of every three U.S. home sales in the first quarter was a foreclosed property as steep price discounts boosted demand for distressed real estate, RealtyTrac said in a new report on Wednesday.

Foreclosure homes accounted for 31 percent of all residential sales in the first quarter of 2010, with the average sales price of properties that sold while in some stage of foreclosure nearly 27 percent below homes that were not in the process, Irvine, California-based RealtyTrac said.

"In a normal market, only 1 to 2 percent of home sales are foreclosures, so this is certainly a significant level," Rick Sharga, senior vice president at RealtyTrac, said in an interview.

Total U.S. foreclosure sales in 2009 were up more than 1,100 percent from 2006 and more than 2,500 percent from 2005. Foreclosure sales accounted for 29 percent of all sales in 2009, up from 23 percent in 2008 and a mere 6 percent in 2007, the real estate data company said.

Foreclosure activity in the first quarter, however, ebbed from the previous quarter as well as year-over-year.

A total of 232,959 U.S. properties in some stage of foreclosure -- including mortgage default notices, scheduled for auction or bank-owned (REO) -- were sold to third parties in the first quarter, a decrease of 14 percent from the previous quarter and down 33 percent from the peak during the first quarter of 2009, when sales of foreclosure homes accounted for 37 percent of all residential sales.

"The drop from the previous quarter can probably be attribute to seasonality, and while the year-over-year drop is significant, it should be noted that it was down from the peak," Sharga said.

"A combination of an enormous inventory of distressed properties and an unprecedented interest by homebuyers to buy these properties boosted sales," he said.

The average sales prices on properties in some stage of foreclosure decreased 23 percent from 2006-09, while the average discounts on foreclosure purchases increased from 21 percent in 2006 to 27 percent in the first quarter of 2010.

The discounts on REOs are larger than those on pre-foreclosures, although discounts on pre-foreclosures appear to be trending higher as short sales become more common, the company said.

"First time homebuyers and investors continue to buy foreclosure properties in large numbers, and at substantial discounts," James Saccacio, Chief Executive Officer of RealtyTrac, said in a statement.

"As lenders have begun repossessing homes at record levels over the first half of 2010, it will be interesting to watch how they will manage the inventory levels of distressed properties on the market in order to prevent more dramatic price deterioration," he said.

Meanwhile, the Sun Belt continued to lead foreclosures nationally, with Nevada, California and Arizona posting the highest percentage of foreclosure sales in the first quarter.

Foreclosure sales accounted for 64 percent of all sales in Nevada in the first quarter -- the highest percentage of any state. The state's percentage was down from 65 percent of all sales in the previous quarter and 75 percent of overall sales in the first quarter of 2009.

California posted the second highest percentage for U.S. states, with foreclosure sales accounting for 51 percent of all sales there in the first quarter -- up from 50 percent in the previous quarter, but down from 70 percent of all sales in the first quarter of 2009.

Other states where foreclosure sales accounted for at least one-third of total sales were Massachusetts, Rhode Island, Florida, Michigan, Georgia, Illinois, Idaho and Oregon.

Foreclosures are by far one of the biggest threats to the U.S. housing market. Improvement in the housing market bodes well for the national economy, as it points to better demand in the sector where the first signs of the latest recession took root.

There appears to be no end in sight as unemployed homeowners unable to pay their mortgages can not refinance their homes. reports have shown that for every job posting, there ate 6 to 100 applicants!

MORTGAGE CRISIS FAR FROM OVER-FORECLOSURES RISING AND NO END IN SIGHT TO REPOSESSIONS OF HOMES AT EVERY INCOME LEVEL

Foreclosure activity fell in April as lenders repossessed homes at a record pace but started far fewer new actions against struggling homeowners, signaling a plateau in loan failures.

Taking less action does not necessarily mean less foreclosure in the future, they have just leveled off due to the government's pressure on banks not to have a speedy process, that the news media may pick up on.

No meaningful improvement is likely this year, however, with mortgage modifications and high unemployment only delaying the inevitable for most of these borrowers, the Irvine, California-based real estate data company said.

But nationwide April foreclosure filings -- notice of default, scheduled auction and bank repossession -- fell 9 percent from March and 2 percent from a year ago.

This was the first year-over-year drop since RealtyTrac started tracking annual foreclosure rates in January 2006.

"What we're really seeing is the effect of lenders slowing down the initial notices of default while they are processing what's already in the pipeline," said Rick Sharga, senior vice president of RealtyTrac.

Lenders filed default notices on 103,762 properties in April, down 12 percent in the month and 27 from a record 142,000 one year ago.

Banks, meantime, took control of 92,432 properties in the month, a record, up 1 percent from March and 45 percent from a year earlier.

With notices on 333,837 properties, one in every 387 U.S. housing units got a foreclosure filing in April.

"The housing market is still in critical condition but is stable," Sharga said.

Borrowers are increasingly tapping federal programs that encourage lenders to alter loan terms to help owners stay in their homes. Still, the overwhelming majority will wind up in foreclosure, he said.

A record 2.8 million U.S. properties got a foreclosure notice in 2009, according to RealtyTrac.

"We still have over a million properties in foreclosure, we still have about 5 million seriously delinquent loans and we're ultimately going to have to work through all of those, so we're not out of this yet," Sharga added.

Foreclosure auctions were scheduled for the first time on 137,643 properties in April, a 13 percent drop from a record 158,000 in March but a 1 percent rise from a year ago.

RealtyTrac sees "overall numbers staying at a high level and ripples of activity hitting the various stages of the foreclosure process as lenders systematically work through the backlog of distressed properties" most of the year, James J. Saccacio, chief executive, said in a statement.

METRO AREA IMPROVEMENT

Foreclosure actions fell in nine of the top 10 metro areas from a year ago.

Cities with populations of at least 200,000 in Nevada, Florida, California and Arizona still dominated the list.

Las Vegas had the highest metro foreclosure rate, with one in every 60 housing units getting a filing, but actions fell 3 percent from April 2009. Modesto, California, was in second place, with activity sinking 32 percent in the year.

FIVE MAIN TROUBLE STATES

Foreclosure activity in fives states -- California, Florida, Michigan, Illinois and Nevada -- accounted for 52 percent of the reduced total foreclosure actions in April.

California led the way, with 69,725 properties getting a filing. That was down 25 percent in the month and almost 28 percent in the year.

Arizona, Georgia, Texas, Ohio and Virginia were the other states with the highest foreclosure activity.

Nevada, Arizona and Florida also posted the top state foreclosure rates last month. These were among states with the most overbuilding and inflated prices during the boom and the most pain during the bust. Unemployment later swept up other states into the foreclosure tidal wave.

Nevada had the highest rate for the 40th straight month, with one in every 69 housing units getting a filing.

Other states with foreclosure rates among the top 10 in April were Idaho, Michigan, Illinois, Georgia and Colorado.

When will it all end? No end in sight until the economy improves, and that will probably mean no earlier than the next president taking office.

The current administration is moving full speed ahead with creating more taxes to stifle job creation, to stifle entrepreneurship, and with the yet to kick-in mandates for health insurance, there will be no recovery possible.

FORECLOSURES ARE NOT SLOWING DOWN-GOOD CREDIT BORROWERS NOW ALSO FACING MISSED PAYMENTS AND FORECLOSURE NOTICES

Every month, the local newspaper carries a listing of all the home sales for the prior month and compares those sales to the prior year sales by price, and takes the average.

For the last year, every reporting period has shown declines in over 90% of the reporting areas, sometimes as high as 95% of the areas showing declines from the prior year.

However, homeowners are struggling to pay the mortgages on their homes, needless to say for obvious reasons. Just because your home value declined as compared to recent sales, there is no reason for someone to sell their home. In fact, there is every reason to hold on since it is likely that your home will not bring the value of the outstanding mortgage, especially if you purchased you home in the last 4-5 years.

The other reason to hold on vary and range from children in a school district, established in the neighborhood, and why sell at a loss.

real estate tends over the long run to present an excellent value and typically by the time the home is paid off, it has increased in price and can provide a retirement nest egg.

However, recently it appears that even homeowners with good credit when they took out their mortgage are in trouble having missed at least one payment in the last quarter. These are NOT the sub-prime borrowers, these are good borrowers!

Homeowners who missed at least one payment on their mortgage surged to a record in the first quarter of the year, a sign that the foreclosure crisis is far from over.

More than 10 percent of homeowners had missed at least one mortgage payment in the January-March period, the Mortgage Bankers Association said Wednesday. That number was up from 9.5 percent in the fourth quarter of last year and 9.1 percent a year earlier.

Those figures are adjusted for seasonal factors. For example, heating bills and holiday expenses tend to push up mortgage delinquencies near the end of the year. Many of those borrowers become current on their loans again by spring.

Without adjusting for seasonal factors, the delinquency numbers dropped, as they normally do from the winter to spring.

More than 4.6 percent of homeowners were in foreclosure, also a record. But that number, which is not adjusted for seasonal factors, was up only slightly from the end of last year.

Jay Brinkmann, the trade group's chief economist, said the foreclosure crisis appears to have stabilized, as the seasonal adjustments may be exaggerating the change from the previous quarter.

"I don't see signs now that it's getting worse, but it's going to take a while," he said. "A bad situation that's not getting worse is still bad." Is this guy an idiot, the statistics prove otherwise.

Economic woes, such as unemployment or reduced income, are the main catalysts for foreclosures this year. Initially, lax lending standards were the culprit. But homeowners with good credit who took out conventional, fixed-rate loans are now the fastest growing group of foreclosures.

Those borrowers made up nearly 37 percent of new foreclosures in the first quarter of the year, up from 29 percent a year earlier.

The risky sub-prime adjustable rate loans that kicked off the foreclosure crisis are making up a smaller share of new foreclosures. They made up 14 percent of new foreclosures in the January-March period, down from 27 percent a year earlier.

Now it is the GOOD credit borrowers who are defaulting.

HOUSING RECOVERY, HOUSING IMPROVEMENT;THE MYTH VERSUS THE REALITY-THINGS WILL GET WORSE BEFORE THEY GET BETTER

There's been a lot of talk lately about a recovery in the housing market – even reports of bubbles re-inflating in certain markets.

Elizabeth Warren, chair of the Congressional Oversight Panel, isn't buying it.

"We see things getting worse in the housing market," Warren says, citing the pernicious effects of foreclosures, which rose 5% in the third quarter to a total of 937,840, according to RealtyTrac.

"The long-term impact of high foreclosure rates on our housing market and overall economy would be disastrous," Warren warns, citing estimates that 10 to 12 million U.S. homes could ultimately go into foreclosure. "We have to get foreclosures under control."

Why the sense of urgency? A single foreclosure property brings prices down an average of $5000 for every house in a two-block radius and costs investors an average of $120,000, she says.

In its most recent report, Warren's panel criticized the Treasury's foreclosure modification efforts as "inadequate" and "targeted at the housing crisis as it existed six months ago, rather than as it exits right now."

Specifically, the Treasury program is targeted at subprime borrowers hit with ballooning mortgage payments vs. prime borrowers hit by job losses. As for the "morality question" of whether the government should be bailing out homeowners, Warren says "I'm passed that," noting "there's plenty of unfairness to go around."

More importantly, "ultimately the American taxpayer -- thanks to Fannie, Freddie and FHA -- is going to stand behind many of these mortgage," she says. "We need to be thinking more globally what is cheapest possible way to bring this crisis to an end."

One solution: Force investors holders these mortgages who may be betting on a government bailout to take a haircut, as occurred with GM and Chrysler creditors.

"That's why they call it investing," Warren says. "You make profits in good times, take losses in bad times. That's the fundamental part of this [modification effort] that's missing."

Mortgages will get harder to obtain if the mortgage investors lose their government backing.

There are lower comps, lower apraisals, more forclosures, higher unemployment, higher gas prices, lower FICO scores, lower rents... sure housing is recovering... ...and Goldman sucks rakes in record profits. the disconnect between wall street and main street widens.

"One solution: Force investors holders these mortgages who may be betting on a government bailout to take a haircut" ------ Got any more solutions? Problem with this solution is that it's like trying to make a single strand of straw from a bale of hay. Who knows who the ultimate investors are? How will you get them all to agree? I suppose if it were considered to be an "involuntary conversion" it may possibly work. All solutions end with a lot of pain for someone (investors), and doing nothing ends in a lot of pain (in theory, homeowners). Either way, it's going to hurt. Meh, I think we're heading for some serious deflation. It looks like it may be inflation because of all the printing, but what would happen today if every loan on everyone's books were written off? That's extreme, but write-off's are happening in many areas of business. When that happens, people get laid off because there isn't that expected source of cash flow (debt repayment). Ugh, not pretty.
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JustinT
JustinT -

The American taxpayer has once again fallen for the catatonic tonic known as the stock market - Keep Your Eye On The DOW ------- Meanwhile, BIG Banks with their taxpayer-supported bail-outs and mega-volume computerized stock trading are once again sucking the last remaining wealth and life blood from John Q. Public, Joseph/ine Six-Pack, et.al. ------- BUT, nevermind that rubish, keep your eye on the DOW! ... you may someday know a BIG banker who can buy you a beer, or tip you for shining their shoes. Complicity is KING, and will save your soul!!! ------- BIG banks WIN, American TAXPAYER LOSES! ------- Yep, America taxpayer snoozes and loses
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RivrB
RivrB -

Those clowns on campidiot.com were right! Hyperdeflation is coming! 5 years from now nobody will be able to afford a $500 starter home!
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marx
marx -

Why buy a house when I can buy gold and an RV


It's simple. We can all take a page from the banksters accounting book. We can stop the Mark to Market value of our homes, just like Washington allowed their bankster buddies to do with their trillions of dollars crap assets.
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JARAA
JARAA -

wait a minute... why do we have to be thinking "globally"? that's how we lost the American jobs to outsourcing in the first place. forget about the international community and globalism... put America first for a change.
Mark
Mark -

Why all this focus on keeping house prices artificially high? This just makes it overly expensive for first-time home buyers. Houses had typically been about 2.5x income, and a return to that level should bring long-term stability to the market. All this governmemt (taxpayer) debt being added on to keep the market inflated is plain stupid for more reasons than I can list.
if they can turn a bad bank to a good bank .and turn a good bank to a bad bank .just think what they CAN /HAVE done to MORTGAGE LENDERS ..LITERALLY GET THEM TO CHANGE ALL THE MORTGAGE RULES FOR A SHORT SIGHTED "POLITICAL AGENDA "FOR THE PAST 20 YEARS AT LEAST.... try this BITE OFF MORE THAN YOU CAN CHEW....TILL YOU CHOKE...and hope barney and the crowd knows the Heimlich maneuver.,,you know what i mean .A KICK IN THE CHEST..


Why doesn't the Fed just change the term of Investor to Government Contractor? Just cause you invest in something doesn't mean your guaranteed to make money on the deal!
san -

What they did in the UK in the 1990s they doubled the term of your loan and if you were unemployed the government paid the interest on the loan because it was cheaper than kicking you out into rented property.

Warren your right, nothing is fair in all of this mess. The Rich will continue to be bailed out at the Taxpayers expense, and they will get Richer no matter what. When the dust settles the middle class will be no more. When all that is left is the haves and have-nots then the shooting and bloodshed will begin.

You can't artifically support asset prices Liz! She is just another bailout shill - smoother, more polished than the rest of the shills.

Interesting talk as other headlines are stating that there is a recovery.

RECORD FORECLOSURES SHOW GOVERNMENT PROGRAMS ARE JUST A LOT OF TALK..IS THAT NEWS TO ANYBODY?

"Worst three months of all time" for foreclosures, blare the headlines....what happened to saving all those homes advertised by the government during one of its numerous bailouts? I guess the bailouts are not for homeowners.

Despite signs of broader economic recovery, number of foreclosure filings hit a record high in the third quarter - a sign the plague is still spreading.

The number of homes receiving foreclosure filings is skyrocketing across the country. Despite concerted government-led and lender-supported efforts to prevent foreclosures, the number of filings hit a record high in the third quarter, according to a report issued Thursday.

"They were the worst three months of all time," said Rick Sharga, spokesman for RealtyTrac, an online marketer of foreclosed homes.

During that time, 937,840 homes received a foreclosure letter -- whether a default notice, auction notice or bank repossession, the RealtyTrac report said. That means one in every 136 U.S. homes were in foreclosure, which is a 5% increase from the second quarter and a 23% jump over the third quarter of 2008.

Nevada continued to be the worst-hit state with one filing for every 23 households. But even tranquil Vermont, where the foreclosure crisis has barely brushed the housing market, saw foreclosure filings jump nearly 170% compared with the third quarter of 2008. Still, that resulted in just one filing for every 5,023 households in the state -- the best record in the country.

The RealtyTrac report also unveiled the results for September, and it found that there was slight relief from foreclosure filings. Last month, notices totaled 343,638, down 4% compared with August. Unfortunately, that total accounts for 87,821 homes that were repossessed by lenders.

That deluge contributed significantly to the quarter's record 237,052 repossessions, a 21% jump from the previous three months. So far this year lenders have taken back 623,852 homes.

"REO activity increased from the previous quarter in all but two states and the District of Columbia, indicating that lenders may be starting to work through some of the pent-up foreclosure inventory caused by legislative delays, loan-modification efforts and high volumes of distressed properties," James Saccacio, RealtyTrac's CEO, said in a statement.

Most disturbing is that all foreclosures -- not just repossessions -- are rampant despite efforts to corral them. Not only has the Obama administration's Making Home Affordable foreclosure prevention program taken a bite out of REOs but lenders themselves have scaled back repossessions over the past few months to give the program time to work.

And in some low-price markets, lenders simply aren't following through on foreclosures, according to Jim Rokakis, treasurer for Cuyahoga County, Ohio, which includes Cleveland.

"They'll even set the date for the sheriff's sale, but they don't file the final papers," he said. "They hold it in abeyance and let the residents stay in the house."

In ever more frequent cases, delinquent borrowers want out of the mortgage worse than the lenders. There are no firm statistics for it, but many industry watchers claim the percentage of REOs caused by borrowers voluntarily walking away from their homes is skyrocketing.

A study of the trend by the Chicago Booth School of Business and the Kellogg School of Management determined that when home price declines drop home values 10% below the mortgage balances, people start to give up their homes. When "negative equity" approaches 50%, 17% of households default, even when they can still afford their mortgage payments.
No end in sight

The foreclosure crisis may not diminish anytime soon. "The fastest growing area is in the 180 days late-plus category, the most seriously delinquent borrowers," Sharga said. "It's going to be a lingering problem."

Plus, the RealtyTrac statistics may understate the depth of the foreclosure mess because lender and government actions have delayed many filings. As a result, some delinquencies have not been counted on the foreclosure tallies. That means the crisis may not end quickly.

And because there are so many delinquent borrowers, Sharga predicts the banks will be slow to take back their properties and put the repossessed homes back on the market.

"It's hard to envision [the banks] putting millions on properties up for sale and cratering prices," he said. "Recovery will be slow and gradual. I don't see home prices getting much better until 2013."

Stay tuned,,,,for the next chapter.

GOVERNMENT FORECLOSURE RESCUE PROGRAM (HARP AND HEMP) IS JUST ANOTHER GOVERNMENT FAILED PROGRAM-NO SURPRISE THERE!

Government programs to fight the U.S. home foreclosure crisis look increasingly inadequate and should be reworked, expanded and supplemented with new ideas, a congressional watchdog said in a report on Friday.

Is anyone surprised...since this is another government program, such as rebuilding New Orleans, and so on and so on.....!

With a foreclosure filing occurring every 13 seconds, the United States is mired in a housing slump that is destroying billions of dollars in property values and threatening to choke off the economy's recovery from a stubborn recession.

The foreclosure crisis has moved beyond subprime mortgages into the prime mortgage market, said the Congressional Oversight Panel for the Troubled Asset Relief Program, the $700 billion bailout launched under the Bush administration.

"Rising unemployment, generally flat or even falling home prices, and impending mortgage rate resets threaten to cast millions more out of their homes," according to the report, which focused on the Treasury Department's efforts to curb foreclosures.

"The panel urges Treasury to reconsider the scope, scalability and permanence of the programs designed to minimize the economic impact of foreclosures, and consider whether new programs or program enhancements could be adopted," it said.

The report was sharply critical of the larger of the government's two big programs designed to fight foreclosures.

It increasingly appears that the Home Affordable Modification Program, known as HAMP, which reduces monthly mortgage payments to help borrowers who are facing foreclosure keep their homes, is not equipped to deal with the changing nature of the housing crisis, the report said.

The government's other effort to stem foreclosures, the Home Affordable Refinance Program, or HARP, helps homeowners who are current on their mortgages but owe more than their homes are worth, get more affordable loans.

As of September 1, the watchdog report said, HAMP had helped arrange 1,711 permanent mortgage modifications, with an additional 362,348 borrowers in a three-month trial stage. HARP has closed 95,729 mortgage refinancings, it said.

The five-member watchdog panel -- sharply divided between Democrats and Republicans -- is headed by Elizabeth Warren, a Harvard Law School professor and outspoken TARP critic.

It issues monthly reports on a range of issues related to the program and the crisis it was meant to address. The October report was accompanied by a dissenting statement from panel member Representative Jeb Hensarling, a Republican from Texas.

"A fair reading of the panel's majority report and my dissent leads to one conclusion -- HAMP and the administration's other foreclosure mitigation efforts to date have been a failure," Hensarling said in the statement.

While Hensarling reached a similar conclusion to the panel's report, he differed on the recommended action. Rather than calling for expansion of the government programs, he urged more basic changes by the Obama administration to its economic policy.

DOUBTS ABOUT MEETING GOALS

Treasury hopes to prevent as many as 4 million foreclosures through HAMP, "but there is reason to doubt whether the program will be able to achieve this goal," the report said.

The problem is that HAMP is limited to certain types of mortgages and isn't prepared for a coming wave of foreclosures stemming from payment option adjustable rate mortgages (ARMs) and interest-only loan resets exceeding eligibility limits.

"HAMP was not designed to address foreclosures caused by unemployment, which now appears to be a central cause of nonpayment," the report said.

"It increasingly appears that HAMP is targeted at the housing crisis as it existed six months ago, rather than as it exists right now," it said.

HAMP's ramp-up has been outpaced by foreclosures. So even if the program hits its November 1 target of 500,000 trial modifications, "this may not be large enough to slow down the foreclosure crisis," the report said.

Finally, the panel said it was unclear if HAMP modifications provide long-term help to homeowners whose payments may rise later. "The result for many homeowners could be that foreclosure is delayed, not avoided," it said.

The report came a day after Treasury Secretary Timothy Geithner said more than half a million troubled homeowners are participating in the anti-foreclosure programs and that they were ahead of schedule. There may be 4-5 MILLION foreclosures.....!

FORECLOSURE FILINGS CAUSE JUDGE TO STOP COURT APPEARANCES FOR HOMEOWNERS!-DEADBEATS WIN!

Chicago's Cook County Circuit Court usually known for its notoriety more than actual fairness, has delayed all actions against homeowners due to the crush if new filings. The presiding judge of the Chancery Division which handles all the cases, so called Mortgage Default Calls (first court appearances made a lender when a borrower has failed to respond to a foreclosure action), has canceled all such calls for July and August.

In the first three months this year 13,200 new foreclosures were filed, and the first appearance is the date on which the homeowner needs to respond or be"defaulted". There were 46,850 foreclosure files pending and this caseload has made it impossible to maintain a meaningful case administration.

This action will allow the homeowners to get additional time to work out deals with the lenders to save their homes, and does not provide any additional time to those homeowners that have filed an answer or consented to the foreclosure.

So, again folks, those people who have done nothing, get the break, while those who follow the rules get the shaft! Those people who do not bother to take any positive action are getting a break.

The Treasury Department started to sign contracts with lenders in the so called MAKING MORTGAGES AFFORDABLE program, a $75 billion program by the administration to help homeowners refinance of modify their mortgages.

The delay may have the unintended consequences of helping deadbeats stay in their homes, making the homes less valuable to the lenders, and therefore causing larger write offs at the banks due to the abatement of foreclosure actions.

It pays to be a dead beat.

FORECLOSURES SOARING ALONG WITH CREDIT CARD DELINQUENCIES AND CUT-OFF CREDIT LINES

More U.S. consumers are falling behind on their mortgages, an indication that the housing market has yet to hit bottom, a top credit bureau executive told Reuters.

Dann Adams, president of U.S. Information Systems for Equifax Inc, reported that 7 percent of homeowners with mortgages were at least 30 days late on their loans in February, an increase of more than 50 percent from a year earlier.

He also said 39.8 percent of subprime borrowers were at least 30 days behind on their home mortgage loans, up 23.7 percent from last year.

"I'm trying to find optimism in these numbers, but I'm pretty hard pressed to do that," Adams said, despite a recent burst of relatively positive news that has fueled hope that the U.S. housing market has turned a corner.

Late last month the Commerce Department reported that sales of newly built U.S. single-family homes rose to a 337,000 annual pace in February, the highest in 10 months.

Such news has boosted homebuilder shares, which are up about 45 percent since March 6, according to the Dow Jones U.S. Home Construction Index.

But Adams said the continued increase in mortgage delinquencies revealed in his data foreshadows more foreclosures, short sales and home price declines as homeowners default and banks then repossess the homes to sell them at deep discounts.

LIFELINE OF CREDIT

The Equifax data also reveals the impact of the rise in unemployment, which is at its highest rate since 1983. Employers cut 663,000 jobs in March, sending the national unemployment rate to 8.5 percent, the Labor Department said on Friday.

The rising jobless rate manifests itself in consumers' increasing reliance on credit cards even as lenders try to restrict access to credit, Adams said.

Banks closed 8 million credit card accounts in February, reducing the number of open cards to 400 million from a July 2008 peak of 483 million, according to Equifax data.

Credit limits fell as well, to $3.27 trillion in February from a July 2008 peak of $3.59 trillion.

"Limits are falling because lenders are trying to minimize their losses," Adams said.

The data shows that lenders have good reason to be wary. Bank card delinquency is at its highest level in the past five years. Some 4.5 percent of total balances on bank-issued credit cards were at 60 days past due in February, a 32.7 percent increase from a year earlier.

"Their credit card is their lifeline," he said.

VACANT MALLS, OFFICE BUILDINGS, INDUSTRIAL REAL ESTATE; THE NEXT BAILOUT OF REAL ESTATE AND INSURANCE COMPANIES ONCE AGAIN

Did you ever go to a mall where a few stores stood empty?

Did you get that funny feeling passing by the stuttered widows or "fake" window displays in the vacant store announcing that the merchandise in the window was from another, still open store?

Near my home is a mall like that.

Last year most of the interior stores have thinned out, with the anchor stores were still standing, but the interior of the mall was an echo chamber.

There were less and less shoppers other than those going directly to the anchor stores and then exiting out to the parking lot.

Not one of the closed stores has opened up as another chain store, nobody wants to open up a store, a boutique....nobody wants to take a chance on a new business in that mall.

I wondered how that mall owner was going to pay the mortgage on that property?

After inquiring further, I learned that this mall is owned by a large mall owner who is attempting to negotiate a better deal with its creditors, and has troubled assets on its balance sheet; other similar malls.

I learned that RETAIL SPENDING accounts for 70% of all consumer spending, and that 25%-30% of that accounts for the Holiday sales.

The better restaurant has closed, the only food in the food court is still being served by a McD's, and several questionable food operations staffed by various foreigners who apparently own the places, hocking their specialty foods, many of which I could not pronounce.

The marry go round still operates, although often with one child on it going around and around to create the impression of some type of activity.

Tracking the ownership schematic....this mall owner is being financed mostly by debt that is owned by.....SURPRISE.......large insurance companies, most of which have not yet been bailed out by the government.

In fact, most malls, and commercial office buildings, are financed owned or in some type of JV project with insurance companies, who have done well over the years in owning such projects or being involved in financing them.

What happens though when the project does not generate enough cash to pay its mortgage loans?

It gets foreclosed, and the lender own it, that;s what happens.

GE is about to publish all the real estate it owns or is about to own...that will be the tip of the iceberg of the total coming to a head.

This is how it works: consumers who have been living off their credit cards, start running out of available credit....by the Christmas sales season this year, their credit lines will be tapped by financing the purchases of day old pastry, food and utilities during the year, leaving little to spend on another shirt or a third TV set for the house. Also, those 29.9% rates on the cards will now appear to be a larger charge than most of the purchases they made to date.

Retailers will be reeling from the lack of spending.

Malls will be getting notices from their tenants of leaving at the expiration of the leases, and many tenants, if not all the tenants remaining, will want a reduced rent, since the expectations of the mall traffic did not materialize. In addition, the percentage leases that many mall owners get from the revenues generated, will decline as well thus generating less and less rental income.

The mall will go into foreclosure, and will be owned by the insurance companies that now also are not generating any income from their foreclosed properties sufficient to cover their costs.

Since 70% of consumer spending is retail, the retailer will pace less orders for goods throughout the entire world, especially in the US, since goods produced here are more expensive.

This entire domino effect will now result in less retail sales (this includes cars), translating to less factory orders, resulting in less needs to transport the goods, resulting in more layoffs in the transportation sector and the industrial real estate sector which now houses those factories, resulting in more layoffs of factory workers, etc., etc......

Who gets to foreclose on those empty warehouses and industrial buildings?

You guessed it, insurance companies and other lenders for these types of properties who are financed by insurance companies.

Are you seeing where this is going?

If you thought the $175 billion given to AIG was a lot, just start adding up the total defaults and losses by the rest of the insurance industry holding all these other loans!

Will they be bailed out too?

Make sure that you life insurance is being offered by a well rated company....and watch for the next "bubble", to blame for the recession, the greedy financing of the real estate industry, part 2, the commercial real estate markets, since many of them were more leveraged than most of the individuals in the sub-prime category.