How awful to lose your home if THROUGH NO FAULT OF YOUR OWN.
It is breathtaking for a normal homeowner who has been laid off or spouse lost work or hours cut back or small business failing.... to figure out how (and whether) to address meeting a loan on a property that is worth tens or hundreds of thousands LESS than the loan. Can't make payments, can't sell, and usually the bank won't talk about short sale until they have missed payments and are deep into the hole with interest and penalties.
There is some fraud here, but a lot of this 3.5 million is cases of human misery. There but for the Grace of God....
Friends took one for a patio, one for a pool, one for a car....and when they sold the house, their equity amounted to "0"...and that was basically their life investment.
The pool was an absolute waste, the patio was no big deal and they just had to have a 3rd vehicle....2 cars and a truck. DUMB!!!
This figure doesn’t even begin to reflect the actual number of foreclosable properties.
In Florida, there is often a 2-year lag between when the homeowner stops paying the mortgage and when the bank files the first piece of paper. The banks do not want the properties. They know they cannot sell them. They are looking the other way and letting homeowners stay in them for free. For years.
If every mortgage that is actually in default were counted as a foreclosure, the number would be way beyond 3.5M.