Aug 17, 2009
There were 360,000 foreclosure filings in July, a 32% increase over a year ago, according to a monthly report by RealtyTrac. The number set a new record – the third record in the last five months.
By all accounts, most of the people being hit by foreclosures today have been in their homes for years. They were not tricked into risky subprime mortgages. They are losing their homes because they lost their jobs or their wages were cut.
Michelle Jones of Consumer Credit Counseling Service, an agency that works with homeowners around the country, says that 72% of people calling the agency in June cited a reduction in income or a loss of employment as their reason for calling.
And by every true measure, unemployment is getting worse and is going to continue to worsen. Despite the big pronouncements about the number of new jobless claims going down last month, the proportion of the population that is employed hit a 25-year low in June.
As a result, people who have lived in their homes and been paying their mortgages for decades are being thrown into the streets.
And this is just the tip of the iceberg; more is yet to come. Almost half of all homeowners are expected to be “underwater” – they will owe more than their house is worth – by 2011, twice as many as at the end of March 2009.
Home ownership, under latter-day capitalism, is a quick trip to poverty.