Black Knight is reporting that foreclosure starts were up 440% in June – year over year!
They were up almost 27% month-over-month too!
So – should we panic???? Is a foreclosure crisis upon us?
Not even close.
Foreclosure starts (the start of foreclosure proceedings) are through the roof, year-over-year, because there was a moratorium on foreclosures last year – and we were at an all-time low!
So, my response to Black Knight is good gravy – you’re totally misleading everyone.
No Foreclosure Crisis Coming!
There is no foreclosure crisis coming and this is why: EQUITY!!
The average loan-to-value ratio in America is only 42% right now, and no borrower is going to walk away from her home if she has a big chunk of equity.
As a reminder, it was not just payment affordability that drove the last foreclosure crisis; it was the lack of equity too, as borrowers simply did not want to make payments against an upside-down asset.
Only 3/10 of 1% (0.3%) of all homes are in foreclosure right now – up from an all-time LOW of 2/10 of 1% (0.2%).
In addition, the foreclosure activity in the first half of this year is literally 1/10 of what we saw in the first half of 2010, for example.
The below chart from ATTOM Data says it all: we are not even close to a crisis.
Beware of media lies!
Jay Voorhees
Founder | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167
