Despite Various Measures Foreclosures Have Spiked by 80% in 2008

January 27th, 2009 | Tags: Foreclosure Notice

Despite various measures taken by local, state and federal governments, foreclosures have spiked by a whopping 80% during 2008. Congress is expected to continue its efforts to address the problem. $50 billion is expected to be passed for the TARP programme and also for the remaining $350 billion from the bailout package.

HUD has simultaneously announced recently the launching of a public service operation to help foreclosure victims. The programme is named Keep Your Home, Know Your Loan. It will be broadcast over television, radio and print in the six cities of New York, Chicago, Detroit, Los Angeles, Miami as well as Phoenix. It is urging those who are defaulting or at risk because of high interest rates to contact HUD either through authorized counselor or over phone.

Steve Preston of HUD said, “We want people to pick up the phone and call a HUD counselor before they reach a point of no return. It expands your options and gets you time to make a good decision.”

HUD has started disbursing funds from its kitty of $4 billion earmarked for Neighborhood Stabilization Program. Congress had sanctioned it about four months previously to help the localities that had been badly mauled by foreclosures.

New York City was given $24 million to purchase and refurbish foreclosed units in 13 localities stretched across the city. The Mayor Michael Bloomberg said, “We’ve worked hard over the past seven years to build strong neighborhoods and we can’t and won’t let the current mortgage crisis destabilize our communities or threaten our quality of life. The $24 million that we’re receiving … will keep New York an attractive place where middle-class families and families of all incomes want to live.”

Already the city has purchased four vacant houses. It is targeting to spend about $62 million on this project by availing of private funds in addition to the federal sanction to transform and sell 115 houses that could accommodate families numbering 250 to 300.

In 2008 over 50,000 houses had been foreclosed upon in New York. Across America 230 million houses have been foreclosed calculating to a rate of 1:54.

James Saccacio of RealtyTrac commented that there is no doubt that the various foreclosure prevention measures taken by the governments and administration at all levels has not had the required effect. The pace of the foreclosure tsunami has not even slowed down.