Shadow Inventory Foreclosure Estimated at 1.7 Million

2009 December 17

An estimated 1.7 million homeowners were on the verge of foreclosure in the fall of 2009, up from 1.1 million a year ago, according to a report by First American CoreLogic, the real estate research company.

Default notices are likely to keep rising through the middle of 2010, a growing shadow inventory of homes threatens housing recovery and weigh down on home prices.

There are about 4 million unsold new and existing homes currently on the market. The backlog of foreclosed homes will add pressure on sellers to reduce their prices.

“We’re going to be dealing with high levels of distressed sales in the marketplace for at least a couple of years,” said Mark Fleming, chief economist at First American CoreLogic.

Citigroup temporarily suspends foreclosures for the holidays

Citigroup will suspend foreclosures and evictions for 30 days until January 17, 2010 for roughly 4,000 borrowers during the holiday season.

“We hope that with this suspension we can make the holidays a little less stressful for our customers who are going through a very difficult time. And we will continue to look for meaningful ways to assist our customers experiencing hardship,” said CitiMortgage President Sanjiv Das in a statement.

Fannie Mae and Freddie Mac Suspend Foreclosure Evictions

Fannie Mae and Freddie Mac said that they will suspend foreclosure evictions from December 19, 2009 to January 3, 2010. The two mortgage giants said the moratorium was put in place for the holidays.

“All owner-occupants and tenants living in foreclosed properties the company holds will not be subject to evictions during the holiday time frame. The company will also support the efforts of the servicers it works with that are taking similar actions,” Fannie Mae said.

“We’re taking this step in support of struggling families who have unfortunately found themselves facing foreclosure,” said Michael J. Williams, President and Chief Executive Officer. “No family should have to face the prospect of being evicted during the holiday season.”

No Second Collapse in Housing Market in 2010
Fannie Mae Predicts Housing Recovery in 2010

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