Have As Many People Lost their Homes as During the Great Depression?
The San Francisco Chronicle notes that it is difficult to keep track of foreclosure rates now … let alone during the Great Depression:
Foreclosure rates of the late 2000s are often compared with those of the Great Depression, which took place through the first half of the 1930s. However, there were no public or private agencies keeping track of foreclosure rates at that time. Indeed, the government still does not keep an official statistic on the number of homes in foreclosure or repossessed by banks and lenders.
But the Chronicle provides estimates of foreclosures during the 1930s:
A 2008 article by David C. Wheelock, an economist at the Federal Reserve Bank of St. Louis, cited annual reports issued by the Federal Home Loan Bank Board during the 1930s. These reports reveal that the foreclosure rate exceeded 1 percent from 1931 until 1935. At the worst point in the Depression-era economic crisis, in 1933, about 1,000 home loans were being placed in foreclosure by banks every day.
How does that compare to the last 5 years?
RealtyTrac notes (via North Carolina State University) that:
From January 2007 to December 2011 there were more than four million completed foreclosures and more than 8.2 million foreclosure starts ….
CoreLogic reported a year ago:
Approximately 1.4 million homes, or 3.4 percent of all homes with a mortgage, were in the national foreclosure inventory as of May 2012 compared to 1.5 million, or 3.5 percent, in May 2011 and 1.4 million, or 3.4 percent, in April 2012. The foreclosure inventory is the share of all mortgaged homes in some stage of the foreclosure process.
Given that there are currently around 316 million Americans – more than twice the number during the Great Depression – such high foreclosure rates mean that there may well be as many people suffering foreclosure than during the Great Depression … or more.
And NBC News reported this month:
Already some 5 million homes have been lost to foreclosure; estimates of future foreclosures range widely. [Moody’s Analytics chief economist Mark Zandi], who has followed the mortgage mess since the housing market began to crack in 2006, figures foreclosures will strike another three million homes in the next three or four years.
For more comparisons of the Great Depression and today, see:
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The current rate is MUCH higher when compared to foreclosures during the Great Depression. There are several reasons and several things to consider in this comparison.
Securitization did not exist back then which meant the bank that made the loan kept the loan. They had a vested interest in working things out with the borrower to keep them in their home. There were no servicers manufacturing defaults and forcing borrowers into foreclosure so they could make a fortune in fee revenue. Had the bankers pulled the same shennanigans then they truly would have been hung from lamp posts.
Deed in lieus and short sales were nonexistent during the Great Depression. Strategic defaults and “jingle mail” were also unheard of. When factored into the rate today, my guess would be the real number of homes in some state of “surrender” or foreclosure is conservatively north of 10%. There’s a reason why the banks hide the real rate from the public. If the American people knew that one out of every ten were losing their homes maybe we would see some bankers swinging from lamp posts.
Never believe any statistic that comes out of Mark Zandi’s mouth.
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please watch this program excellent
why is our congress and our president not doing anything to help us. why are they just allowing this to continue???
The article mentions the following: “Indeed, the government still does not keep an official statistic on the number of homes in foreclosure or repossessed by banks and lenders.”
It would seem to be a matter of great societal importance wouldn’t it? Whose Government is this?
listen to Matt Weidner and his lack of real defenses so just get delay for delay’s sake. what a country.
live for free.
Of course this kind of a statement would only come from a foreclosure mill attorney. Ain’t that right 13076?
How’s web site is this one? Seems that someone may be taking over the main one I been talking with
Who’s playing who now?
Well those other email addresses I have seemed to be hacked into not sending out to who I want
Help me out here please