A New Foreclosure Wave Hits The Jobless

CBS Evening News: People With Traditional Mortgages Who Have Lost Their Jobs Are Now Facing Foreclosure

(CBS)  There's a new wave of foreclosure sweeping across the country, and the people who are getting swept up are not greedy investors, or people who got in over their heads with bad loans, reports CBS News correspondent Ben Tracy. Rather, the crisis is hitting home for those who never expected to be in trouble until the slumping economy put them out of work.

As a code enforcer, Judy Jones' job was to make sure foreclosed homes, often trashed by owners on their way out the door, got cleaned up. With a government job, good credit, and a 30 year fixed rate loan on her southern California house, Judy never planned on taking her work home.

But last month she was laid off, joining a new wave of homeowners who paid their mortgages on time but now can't because they're out of work.

"The foreclosure crisis began mostly as a problem for lower income households," says Mark Zandi of Moody's. "It is now a problem for all households: low, middle income and even higher income households."

More than 2 million prime mortgages, traditional loans for people with good credit, are now delinquent. That's 624,000 more than this time last year, according to the mortgage bankers foundation, Tracy reports.

"We didn't necessarily expect the distress levels that we are seeing at this point," says economist Mark Fleming.

It used to be if you couldn't afford your mortgage you could always try to refinance or sell your home and pay off your loan. But these days, for a lot of people, those options no longer exist.

That's because 12 million households now owe more than their homes are worth, according to Moody's.

Homeowners with risky adjustable rate mortgages are getting help from banks, but there are no programs to aid those who already have good loans but no jobs.

"I wake up in the middle of the night thinking about it," says Terri Osier, a struggling homeowner.

Meanwhile, Judy Jones is hoping her bank will lower her payments until she finds work.

"If they don't, I'm not going to drain my savings, I am not going to drain my 401k, I am going to walk away," Jones says.

[pforeclosure]

The only good thing that you might be able to say about all this is that banks are more inclined to go forward with a loan modification for those homeowners who have suffered a job loss. A bank''s loan modification can provide a lower monthly payment by reducing the rate, term or in some cases the principal. A do-it-yourself loan modification guide is available for those interested at preventingforeclosure.org, a non-profit resource.

[wardoglrs]

The Federal Reserve Robbing America since 1913:

Don''''t pay taxes and stop using credit card''''s. you can defeat these Neo Cons America, with the same fire they use "MONEY"

The IRS is a guard dog created by the Jewish Zionist like everything else they control, if you don''''t fight what you see and know to be true and sound then you have lost.

Destroy them before they destroy you & your family''''s security. There not worth it...
Google "End the fed"

Return to your Constitution it protects you from them..Enforce your fraud law''''s on all leadership
Jail them before they jail you.

Or better yet just get a rope

[ffoulkes-2009]

Now THESE are the foreclosures you feel bad about. When people are unable to work or find jobs and lose their homes.

I don''t feel any pity for people who bought above their income in hopes of flipping the house two years down the line. These are the ones who brought economic disaster among us.

[element51]

Walt.....I agree with your post. The funny thing is that these same people who looked down their noses at the dastardly no good democrats are the same ones that are now blaming the democrats for their problems. They do not seem to realize that there has been a full scale war against the middle class since Reagan took office. They continue to support the very people who are trying to destroy them. All the cons have to do is say "abortion" or "gay marriage" and the idiots vote for them. With the exception of the damage he did, I cannot recall one thing Bush did for the middle class in his eight years in office. When you factor in Limbaugh and Hannity it is no wonder that we are in the sorry mess we''re in. I just hope that Obama at least gets a chance before they start screaming for his head on a platter. I heard just a few days ago that they have revived the rumor about his birth certificate and that he is not going to be allowed to assume the presidency. What the hell will they come up with next?

[walt1944-2009]

I remember several months ago when neocon Fascist Nazi Republicans were "crowing" about how people should be more responsible in what they buy, that the mortgage crises was caused by "bad people in bad loans" and that IT COULD NEVER HAPPEN TO THEM!!!!

Apparently they thought that a bad economy and job loss would NEVER, EVER happen TO THEM! After all, the Great Emperor Bush would NEVER have stupidly-loyal neocons lose THEIR jobs and suddenly find the uncharted frontier of UNEMPLOYMENT! That was only meant for evil, cowardly Democrats who dared to criticize the fantasy economic policies of the Great Emperor Bush II.

Now these same neocons who said that "bad people should never be given loans" are out of work and having trouble hanging on to what THEY HAVE!!!

Yes, there is a LOT of truth in that old saying "What goes around, COMES AROUND"!!!

SIG HEIL, I DON''T HOLD A GRUDGE, MUCH!!!!, BUSH!!!

[drivelphobe]

Element51...

I believe in safety nets for those who fall on misfortune. I also believe families and friends should help each other.

I may be unfair in my assessment, but I can only comment and have opinions about what I have experienced in my life. I am "older" and I can see the stop sign. I have seen friends and family fail to do the most basic things to improve their lives financially. Many live in hopeless situations, with the future only looking bleaker. It is all their fault and now they are bitter, resentful and self-destructive. What a waste of life.

Nice chatting with you. You seem like a nice, upstanding and valuable person. Thanks for your comments.

Have a nice weekend.

[drivelphobe]

Element51...

It seems very easy for you to accuse me of being smug and patronizing, but that is your right. Actually, I don''t "deem" anyone beneath me. I believe everyone has the same chances in life.

My whole point is that everyone has the same opportunity, excluding major life changing events. I do understand that horrible things happen to individuals and families, but that is not what we''re discussing here and you know it.

I''m addressing the millions of individuals who refuse to deal with life and refuse to do the simple things that all of us know are correct. These people take more than they are worth.

You can''t drift through life and expect to live like those who have struggled for years in jobs, careers and businesses, day after day, year after year, with discipline and fortitude. Those who have saved and made investments, rather than impulsively splurging on toys, booze, and personal gratification, have earned the right to a better life. The shouldn''t feel guilty about it even though that would make you good. It isn''t just luck that people succeed in life as you intimate.


It is sad to see people with nothing but despair. Many are only reaping the seeds they have planted.

It is never too late to pick yourself up and start new. Unfortunately, few have that drive.

[element51]

drivel...I don''t mean to be so hard on you. I just feel that you are being very unfair in your assement. There are and always will be people who milk the system and don''t give a dam about what they do. But there are many who have fallen on hard times through no fault of their own. Don''t listen to fools like Rush Limbaugh and Sean Hannity when they try to make villans out of those who are in need of help. They are men who make millions spewing hate to keep us divided. It is people like them who are the real terrorist in this country. They are to be feared because of their ability to keep us at each others throats. I think it is entirely possible that deep inside you are a good guy. Let that goodness come to the surface and I believe you will be a much happier person.

[element51]

Meg001....Thank you for your kind comments.

[drivelphobe]

Hi curse914...

Correction. I firmly believe in luck, both good and bad.

The poor aren''t all poor because they are lazy. My main premise is they make bad decisions about everything, especially things concerning finances, education, breeding and frugality.

You assume incorrectly that I have, "everything he has". I have little, but make it work as millions of other Americans do.

Once again your post is unclear, but rude and accusatory.