http://www.washingtonpost.com/wp-dyn/content/article/2007/06/14/AR2007061400513.html?referrer=emailForeclosure Rate Hits Historic High
By Dina ElBoghdady and Nancy Trejos
Washington Post Staff Writers
Friday, June 15, 2007; D01
The percentage of U.S. mortgages entering foreclosure in the first three months of the year was the highest in more than 50 years, according to the Mortgage Bankers Association....The high translates into about 254,591 mortgages, or one in 172 loans, the association said...
The problems weren't uniformly spread around the country. Doug Duncan, chief economist for the mortgage bankers group, said the rate of new foreclosures would have dropped had it not been for big jumps in California, Florida, Nevada and Arizona. He said high rates in Ohio, Michigan and Indiana also drove up the overall percentage of loans in foreclosure...
Some who track the industry say the worst is yet to come...
Democratic lawmakers have blasted the Federal Reserve for a "pattern of neglect" that fostered the crisis. Yesterday, the Fed invited consumer groups, lenders and other experts to weigh in on how it can rewrite its rules to prevent predatory lending.
"We must determine how we can weed out those abuses while also preserving incentives for responsible lenders" so that risky borrowers still have a chance of homeownership, said Randall S. Kroszner, one of the board's governors.
The board focused on whether to crack down on the use of prepayment penalties and loans that require little or no documentation of salaries. It solicited opinions on whether escrows for taxes and insurance should be required. It also questioned whether loan officers should be required to make sure potential borrowers are capable of paying back the loans they are applying for.
No consensus was reached on any of the topics, and Fed officials declined to comment on yesterday's foreclosure numbers.
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