Nearly four years after the real estate market peaked, an alarming number of Americans remain in danger of losing their homes. A non-seasonally adjusted 15 percent of home mortgages were either delinquent or in foreclosure at the end of the fourth quarter of 2009, according to the Mortgage Bankers Association. That's the highest-ever tally in the history of the MBA's National Delinquency Survey.
Mike Larson of Weiss Research points to two key factors behind these high delinquencies. Sharply falling real estate values have put about 21 percent of homeowners underwater, meaning that they owe more on their mortgage than their home is worth. Property owners in this position--which is also known as having negative equity--may find it in their best interest to simply walk away from the home (even, in some cases, when they can afford to make their monthly payments). At the same time, an uncomfortably high national unemployment rate of 9.7 percent means that many Americans won't have the income they need to pay their bills.
Today, some particularly hard-hit markets are in the unenviable position of having both elevated unemployment and high concentrations of negative equity. "Clearly, those are the markets where you are going to see some of the worst metrics on the foreclosure side," Larson says. "You are going to see a lot of people walking away you are going to see a lot of distressed inventory that's being dumped on the market." To pinpoint housing markets that are facing these twin default risks, U.S. News compared negative equity data from Zillow with unemployment figures from Moody's Economy.com. (All data refers to the fourth quarter of 2009.) Based on this data, here is a look at 10 cities that face a double whammy of default risks.
Read more: http://finance.yahoo.com/news/10-Cities-Facing-a-Double-usnews-3949187679.html?x=0
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