With the list of cheap homes and the number of foreclosed properties continuing to hammer Michigan's housing market, the state initiated a federally-supported program designed to stem the housing crisis and help troubled homeowners retain their properties.
The story is the same in almost all local areas of the state. Detroit, Oakland County and Warren foreclosure listings are all riddled with thousands of homes being offered for sale. Southeastern Michigan actually posted a record 2010 first half in terms of foreclosures, with 47,563 homes in the region ending in foreclosure which translates to a 35% increase compared with the first half of 2009.
The problem of foreclosure listings in Michigan is reportedly not helped much by mortgage modification programs launched by the federal government. According to the United States Treasury, over a million households underwent Home Affordable Modification Program trials, but only 346,816 ended up having their loans permanently modified.
In an effort to help Michigan residents who have lost their jobs and are about to lose their properties to house foreclosure listings, the state has introduced a program that has received support from the federal government. Within a day after the effort has been announced, local officials reveal that around 30,000 phone calls were made to state agencies by those trying to secure a place under the program.
Some market analysts have expressed doubts on the ability of the program to dent the list of cheap homes and foreclosed property numbers in the state. According to them, the program worth $154.5 million can help 17,000 households at best within 18 months. They consider this an insignificant number in a state where 78,000 properties are being lost to foreclosure every year.
Real estate experts have explained that the problem facing Michigan homeowners have a lot of factors behind it. They reveal that foreclosure problems remain unresolved for most homeowners because, for one, some mortgage servicing companies are not prepared in terms of dealing with millions of loan defaults and are struggling to cope with the paperwork.
In addition, analysts claim that the recession has caused the foreclosure problem to trickle down to borrowers who have good loans but ended up not being able to pay their mortgages due to reduction in income or job loss. These developments led to increased number of foreclosed dwellings and an expanded list of cheap homes in the state.
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