Mississippi Foreclosure Weather Forecast

June 16th, 2008 | Tags: Foreclosure

The Mississippi foreclosure weather forecast is not much to crow about. The local bankers are sitting together to analyze the matter. 60-year-old Bill Sones is a bank president – a successful chairperson of the Mississippi Bankers Association. He quips that each of this four children, who are in their late twenties and early thirties have better houses than him! Sones is the President of the Bank of Brookhaven. He added that although his children have not fallen into trouble many others have.

This desire to want the best of the best has infected a whole new generation and is one of the root causes of this foreclosure crisis. The new nest builders will stop at nothing to reach their goals – including taking loans that are well beyond their income parameters. Speaking at a foreclosure meeting Sones stated categorically “They expect more and they expect it earlier. That itself is problematic.” The lending standards have been lax in the advancing of sub-prime mortgage loans. This has coupled with lack of financial education among the borrowers to compound the foreclosure crisis.

In Mississippi the foreclosure crisis is costing the state about $235 million as compared to $309 million in Alabama, $ 497 million in Louisiana and $711 million in Tennessee according to Gary Beasley who is the regional manager of Federal Deposit Insurance Corporation’s division of Insurance and Research wing. The calculations have been based taking into account the fall in foreclosed and its neighbouring properties and decreasing property taxes. Beasley clarified that the estimates are not official releases of the FDIC but are his own findings.

In states like Arizona, California, Florida, Georgia, Maryland, Illinois, Michigan, Massachusetts, New York, New Jersey, Pennsylvania, Ohio, Virginia and Texas the estimated loss could well be more than $2 billion.

Mississippi ranks among the toppers as regards delinquency numbers. There are 13,000 persons slapped with delinquency notices – calculating to 3% of the total population. In the churning real estate market it is difficult to pinpoint Mississippi’s position.

After Hurricane Katrina had hit in August 2005, the Governor Haley Barbour had put a hold on foreclosures. This accounts for the number of foreclosures being low here in comparison to other regions. Last autumn the moratorium expired. Together with increasing fuel prices the foreclosure weather in Mississippi might darken and worsen. Governor Barbour put it aptly when he said “$4 gasoline does wicked damage to lots of families.”