Get Ready for New Wave of Foreclosures

By Kevin Spak,  Newser Staff
Posted Jul 4, 2009 6:05 PM CDT
Old furniture is left on property identified by a local real estate agent as a foreclosed home in the 35th Congressional District represented by Maxine Waters, D-Calif., in Los Angeles, June 5, 2009.   (AP Photo/Damian Dovarganes)
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(Newser) – Another wave of foreclosures is on the way, possibly as early as this summer, threatening to upend a housing market that had begun to stabilize, the LA Times reports. Though loan defaults are up sharply, banks have been delaying foreclosures lately thanks to the Obama administration’s home-stability plan. Now with many government and self-imposed foreclosure moratoriums set to expire, big lenders have signaled that they’ll be cleaning house.

Rising foreclosures will further depress home values that had begun to bottom out or, in some parts of the country, even rise. One Moody’s economist estimates that 15.4 million homeowners are underwater, owing more than their house is worth. A Chase Bank spokesman says that that in addition to many new foreclosures, the bank will be moving again on 80,000 foreclosures it had voluntarily suspended.