Distressed Properties and Foreclosure Problems Hit Middle Class
Distressed properties and foreclosures are becoming common among middle and upper class homeowners in Missouri. Analysts cited unemployment as the main factor. By MostlyForeclosures.com
An increasing number of foreclosed and distressed properties are being found in middle and upper class subdivisions in some areas of Missouri. According to housing market analysts, this shows that another wave of foreclosure crisis is hitting the state, this time not because of bad loans and subprime mortgages.
According to housing industry experts, Kansas City foreclosure homes and distressed houses in other metropolitan areas of the state have become quite common in the past few years. However, another wave of foreclosure is emerging, this time from areas that were previously immune from the housing market crisis like Cape Girardeau County. The area posted 387 foreclosure-related filings last year, representing an increase of over 20 housing units from the 2009 total.
The number might seem small, particularly when compared with metro areas that have seen thousands of foreclosed homes in Missouri and massive declines in property values. However, analysts stated that the figure is significant because majority of these foreclosed properties are owned by middle income-earning families and even people who belong to the upper income level.
Housing industry experts stated that these people were not affected by the first onslaught of foreclosures and distressed properties as they did not take out subprime or bad loans, which were largely blamed for the housing market crisis that first emerged more than four years ago. What the current trend is showing, analysts reveal, is that the reason is not bad loans anymore, but job loss. They stated that the latest additions to the foreclosure problem are mostly people who have lost their jobs or are encountering financial difficulties.
Industry experts stated that subprime lending-related foreclosures are almost gone and most have already worked their way through the system. Now, owners lose their properties to list of foreclosed homes for sale due to unemployment, decrease in income, divorce and medical reasons.
Analysts stated that a big number of these homeowners have never faced such problems before. During the start of the crisis, when distressed properties are just starting to increase, they felt secure because they have traditional loans. However, unemployment was something they did not expect and they need to be advised properly about the options that are available to them to save their homes, analysts further added.
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