A late addition for Maryland Mortgage Program
Maryland officials have been outspoken on the subject of foreclosure prevention, lecturing mortgage servicers to work with struggling borrowers and passing laws to try to make loan modifications more likely. But it wasn't until recently that the state's own mortgage program -- aimed at first-time homebuyers -- designed a modification option to lower monthly payments to an amount its borrowers in trouble could afford.
Three of those loan modifications have been approved so far. Four more have been OK'd by the state but are awaiting authorization from mortgage insurers.
While we're on the subject of delinquencies and foreclosures, you might be interested in the results of a project by The Seattle Times and ProPublica that looked at three areas -- one of them Baltimore. Reporters there were frustrated by the lack of good information on the foreclosure crisis (amen to that) and compiled a random sample of foreclosure filings in Baltimore, Seattle and Phoenix from 2005 through 2008.
As you'd expect, the dataset shows "how the housing bubble and lower lending standards of the era reinforced each other, seducing many homeowners to get in over their heads." But there were significant differences by geography, the organizations wrote:
In the Phoenix area, one of the biggest housing bubbles in the nation suddenly burst, unleashing an equally sudden wave of foreclosure filings.
In the Baltimore area, job losses in an aging city threatened home purchases and neighborhood revitalization.
And in the Seattle area, longtime homeowners responded to lenders' aggressive pitches by tapping into rising equity, taking on more debt, and refinancing into adjustable-rate mortgages.
I think the problem isn't only about job loss in Baltimore, though, at least not at first. Many people live in the city but work outside it, and the state didn't start losing jobs until the spring of 2008.
Part of the story is speculation. When I analyzed Baltimore foreclosure proceedings started in early 2007, state records showed that properties belonging to "non-owner occupiers" -- usually real estate investors -- accounted for nearly 30 percent of the city homes that lenders were trying to foreclose on.
What factors do you think were key in causing foreclosures to spike in our area?