Many American homeowners — initially attracted to low teaser rates on those “exotic” ARMs and sub-prime loans — now find themselves swimming upstream in a desperate attempt to remain financially afloat. But as the rising tide of mortgage debt grows, many of those homeowners will unfortunately sink, drowning in foreclosure red ink. 

For the thousands of homeowners who jumped into turbulent housing waters via these easy-to-qualify-for loans, they are now succumbing to a riptide of bad news.  RealtyTrac™ (www.realtytrac.com), the leading online marketplace for foreclosure properties, released its September 2006 U.S. Foreclosure Market Report, which shows 112,210 properties nationwide entered some stage of foreclosure during the month, a decrease of less than 1 percent from August, and a 63 percent increase from September 2005.  The report also shows a national foreclosure rate of one new foreclosure filing for every 1,030 U.S. households, the third highest monthly foreclosure rate reported this year.  And prices of existing homes fell in August for the first time in 11 years as sales dipped to their lowest level since early 2004, according to the National Association of Realtors.

The next big wave of news may be a true real-estate slump, as hundreds of billions in adjustable-rate mortgages reset, making it even more difficult for homeowners in depressed markets to meet higher monthly payments. Those with adjustable-rate loans — almost a quarter of all U.S. mortgages — will face re-adjustments soon. That means higher monthly outlays and higher foreclosure rates.

Earlier in the year, there was a lot of discussion about a “soft landing” for the residential real estate market.  Now there is increasing talk of a “harder landing.”  But even if real estate's landing is a soft one, one thing is clear:  Real estate investors, agents and home buyers interested in successfully navigating the real estate foreclosure tide should let RealtyTrac help steer the ship towards continued success in the real estate business.

At RealtyTrac, we look to help you chart your course through rough waters, by supplying you with the latest in real estate news and information on foreclosure activity. We welcome your comments and feedback on this and other posts on ForeclosurePulse.blog.