US housing slump without precedent

… foreclosures up 121 percent over 2007

Published on WSWS, by David Walsh, 26 July 2008.

… In the three-month period April through June, some 740,000 foreclosure filings were recorded in the US, an increase of 14 percent over the first quarter and 121 percent over the same period in 2007. According to RealtyTrac, one in every 171 US households received a filing, which includes notices of default, auction sale notices and bank repossessions.

The banks took back some 220,000 homes in the second quarter (and 370,000 in the first six months of the year) and there are presently 18.6 million homes in the country standing empty, the highest number in history. The number of vacant houses has jumped nearly 7 percent in the last year …

… WHSM television reported, “Neighbors said it is a sign of the times.”

Bruce Marks, chief executive of the Neighborhood Assistance Corporation of America, told the Boston Globe that it was not uncommon for homeowners to contemplate suicide when they were not able to keep up their mortgage payments.

“What gets us so angry is that people blame themselves,” Marks observed to the newspaper. “They can’t see past their sense of responsibility to see the responsibility and the predatory nature of these lenders. The fact of the matter is, unless something dramatic happens, there’s going to be more and more people like her taking their lives.”

Emails from readers posted by the Taunton Call about the episode provide some indication of popular sentiment.

Wrote one reader: “My heart goes out to this family. How tragic that she felt that she needed to take her life. Mortgage companies are so heartless that I am sure they still care more about auctioning off this house than the family of this poor woman. I am sure buyers will be lined up tomorrow. What a very sad sign of the times!”

Another commented: “I have pleaded in the past with my mortgage company to work with me on my rates because I was stupid not to read the whole 10 thousand pages when I bought my house and now I’m stuck with a mortgage that will go up every 6 months. I’m on my way to foreclosure and I don’t know where to go as a single parent with 3 kids. A mortgage company shouldn’t feel sorry for people, but have a heart if someone is trying the hardest to pay the mortgage—then give them a little time.”

A third wrote: “Most people who read this article will probably say to themselves ‘of course they foreclosed the house, it’s the law, they had too.’ The sad truth is that they are right because that is how the world works. This article should be an eye-opener to anyone who reads it. It clearly shows how disgusting and ridiculous the system of government we live under is. Just the fact that people are driven to suicide simply because of ‘financial pressure’ is horrible. In America people are supposed to have a right to life, liberty and the pursuit of happiness, but this story revokes all those rights. Situations like these disgrace the good intentions that the fathers of this country once fought for. I see this as banks (and other money collecting companies) having the right to take from clients even when it may result in death.” (full text).

Links:

Banks sharply increased fees as US households fell deeper into debt, 25 July 2008;

US foreclosure filings rose 53 percent in June
, 11 July 2008;

Bernanke, Paulson outline strategy to make working class pay for Wall Street crisis, 10 July 2008.

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