New research indicates that it may take decades for states clear the 2.1 million homes in foreclosure or with seriously delinquent mortgages, USA Today reported on November 8, 2011. A report from LPS Applied Analytics used data collected from 40 million mortgage loans said that it would take more than eight years on average to clear their backlogs at the current pace of foreclosures.
Washington DC, along with New York, is facing a “pipeline ratio” (the estimated length of time to clear backlogs at the current sales pace) of 57 years, while Maryland is facing 21 years, according to the report. USA Today said the longer timeframes give borrowers needing foreclosure help more time to work out their situations, and may support home prices by reducing the supply of distressed properties for sale. However, RealtyTrac CEO James Sacchio told the newspaper they also delay recoveries because buyers may wait, fearing further price drops when distressed homes do hit the market.
“It’s a question of whether you rip the Band-Aid off quickly or slowly,” LPS senior vice president Herb Blecher told USA Today. While pipelines may be clogging up, homeowners facing foreclosure should still act quickly to protect their assets. Our Maryland bankruptcy lawyer can explain your foreclosure rights and help determine if a Chapter 13 or Chapter 7 bankruptcy process is an appropriate course of action.
Law Firm of Kevin D. Judd – Maryland bankruptcy attorney