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Key Factors In Home Foreclosures By State Trends

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By : John Cutts    99 or more times read
Loan defaults are not the only cause of the increasing number of foreclosure homes in the market. There are many factors that affect the trends in US home foreclosures by state. Whether they contribute to the rise or decline of the housing market, still, it is best if we can examine and understand these factors that drive one of the important aspects of the economy.

Delinquent Loans

Delinquent loans, of course, lead to repossession and foreclosure. If a homeowner fails to pay his loan and defaults on his mortgage, the lender or bank is constrained to take actions that will mitigate the loss it has already suffered by reason of the borrower’s default. If the lender does not foreclose, interests will pile up and the borrower will undoubtedly be neck-deep in debt. A homeowner who misses a payment will find the next payment to be much more difficult to meet since interests, charges and fees will have to be added to his outstanding balance.

Lack of Job Opportunities

High unemployment rate is one of the main reasons why many homeowners are forced to default on their loans. Without any source of income, a homeowner will not be able to meet his financial obligations on time. This is why a lack of available job opportunities affect the increasing number of home foreclosures by state since it leads to a restriction of the borrower’s ability to pay.

Worse, unemployment undeniably results in low levels of home sales activity since it is the consumer and the buyer that is largely affected by this factor. The problem with this is that, unless something is done to remedy this problem, it becomes a vicious cycle that creates unfortunate circumstances for all sectors involved.

Economic Crises

Of course, the economy also plays a major role in the trends of home foreclosures by state. When the economy dips, the market also suffers. How the federal government manages the economic affairs largely determine how the housing market will cope with the current financial challenges.

High inflation results in decreased consumer ability to pay their bills and necessities. This could also potentially result to a foreclosure if the economy worsens over a prolonged period.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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