New regulations have been proposed to help financially struggling families remain in their homes and reduce the number of Charlotte foreclosed homes for sale.

The North Carolina Office of the Commissioner of Banks has announced a proposal that would immediately stop foreclosures once troubled homeowners request for loan modifications. Currently, banks and mortgage lenders are simultaneously negotiating with homeowners who are seeking for loan modifications while pursuing foreclosure.

A proposed regulation also requires mortgage lenders to respond immediately to troubled homeowners when they request for assistance. If approved, the regulations would cover only mortgage lenders and brokers and exempted savings, loans and banks.

The proposed regulations are welcomed by industry experts who claimed that despite a significant decline in the number of foreclosure properties, the figures are still big enough to warrant more actions to prevent them from becoming an epidemic.

According to market data, a drop in the number of Charlotte foreclosed homes for sale was reported in August. About 76,134 distressed homeowners lost their properties to foreclosures for the month, representing a 12.7 percent drop from July.

Experts said that the drop could be attributed to the slow repossession activity of banks. It could also mean that the Obama Administration’s loan modification program has finally started to show some positive results.

They said that it is most probably that banks are delaying foreclosing on distressed properties. It is a known fact that banks incurred big losses when properties on their portfolio went into foreclosures. This could have influenced banks to delay foreclosure proceedings, thus allowing delinquent homeowners to still remain in their homes.

Experts explain that banks are into the financial business and do not want to become landlords. Furthermore, foreclosing on properties means homeowners would be forced to move out of the houses, leaving them vacant and no one to maintain them.

Delaying foreclosures means that banks have someone to care for the distressed properties, thus saving them the cost of maintenance.

However, the drop in foreclosure rate is not expected to last long as a flood of payment problems is expected soon as adjustable rate loans starts resetting. This problem is also compounded by record level unemployment rate.

Market data has shown time and again that where unemployment is the highest, so is the number of foreclosed home. And the increasing foreclosure rate remains to be the strongest indicator of the current economic downturn.

The trend of rising unemployment and foreclosure is very much in evidence in Atlantic County, New Jersey. According to industry experts, 60 percent of the homeowners’ wealth are from their home equities. Losing a home to foreclosure means that a homeowner’s financial situation is in a very precarious position and everything could go downhill if no help can be found immediately.

Across the United States, foreclosed home started to sprout as the housing market collapsed and recession sets in. Foreclosures started increasing and they have not stopped yet. From July to September this year, the number of foreclosure filings rose by 5 percent compared with the previous quarter and a rise of 22 percent from the previous year.

In New Jersey, the foreclosure rate showed a slight decline early this year but is starting to rise again. In the third quarter, Atlantic County posted a 33 percent increase in foreclosure rates compared with the second quarter and a 9 percent rise from last year’s third quarter.

Comparable data showed that Cape May County posted a 30 percent increase in the third quarter, unchanged from the same period last year. In Cumberland County, foreclosure rates rose by 35 percent from July to September, representing a 6 percent drop for the same months last year.

Industry experts said that the figures indicated that more and more homeowners are in worst situations compared with last year. They noted that foreclosure rates are as high as last year, if not even higher.

Early in the foreclosure crisis, majority of homeowners defaulted on their mortgage payments due to bad lending practices. But as the economy continues to languish, it created another problem that exacerbated the foreclosure crisis: unemployment.

Industry experts said that unlike the first wave of foreclosures in which many of those who lost their homes were irresponsible borrowers, the current wave of delinquents are composed of prima mortgage borrowers, those who were creditworthy and have the ability to repay.

Last month, the unemployment rate in Atlantic County hit 12.2 percent, 8.5 percent in Cape May County and 12.6 percent in Cumberland County. It would not take long before these figures would translate into foreclosure home rates.

Industry experts believe that one way to prevent the spread of Atlanta foreclosed homes for sale is to make affordable housing accessible to everyone. Several branches of Federal Home Loans Bank (FHLBank) have made it their commitment to provide affordable housing to promote homeownership in the current economy.

The FHLBank of Atlanta is one of the district banks that launched the AHP which has become a critical and reliable gap financing source for developers of affordable houses. AHP is a major source of grants for affordable housing projects in the country.

Since its inception 20 years ago, the program has provided over $3 billion grants to various projects across the country, including helping to construct over 623,000 affordable houses, with 391,000 of them for low-income families.

At FHLBank of Atlanta, scoring incentives has been implemented this year for those applicants that have demonstrated their capabilities to secure funds that will leverage AHP funding. The bank also created a scoring incentive designed to reward projects that have become part of structured and coordinated effort to prevent the spread of Atlanta foreclosed homes for sale.

Industry experts said that the initiative is a reflection of the commitment of the bank to make AHP a part of the wide array of solutions designed to address the problem with affordable housing.

Last year, the FHLBank in Atlanta awarded a total of $46.3 million AHP grants to about 89 projects composed of 4,514 housing units. The grant awarding is based on a competitive cycle. Furthermore, nearly $17.7 million were granted to first-time homebuyers under the AHP.

Meanwhile, an Affordable Housing Finance survey of 12 district banks of the FHLBank showed that five units are experiencing a shortage in AHP funds this year. Industry experts said that this trend could continue until next year.

According to study data, the AHP funding posted a 23 percent drop from last year. Normally, district banks allocate 10 percent from their yearly net income for AHP funds. As a result, the funding for AHP can fluctuate, with the availability of which dependent on the bank’s profits. This means that if the bank experienced a drop in profits, it would have less money to fund its affordable housing program.

Detroit foreclosed homes for sale is mounting and the numbers are expected to continue climbing in the coming months. Industry experts said that the increasing foreclosure trend is an indication that the tax foreclosure system in the Michigan city is failing.

Driving around the city of Detroit, one could see older ranch-style houses that were constructed and financed by religious organization and wide, open spaces where houses have been burned down or demolished.

For the October auction, Wayne County officials listed 15 vacant land holdings in just one street. These vacant lots were foreclosed after their owners failed to settle their taxes which were overdue for three years. At the auction, none of the land holdings were sold at the $500 minimum bid.

Meanwhile, residents were not aware that many properties in their neighborhoods were on Detroit foreclosed homes for sale. Industry experts said that many people are struggling financially, leaving the city with no option but to send workers to do the mowing of lawns in vacant and foreclosed properties.

Detroit was once an industrial powerhouse before the economic downturn and the collapse of the housing market. Now, it is viewed as a dying city with 28 percent unemployment. Its foreclosure system is based on the belief that the housing markets will recover and buyers must continue to rule.

In a recent tax foreclosure auction, over 80 percent of properties on sale failed to find interested buyers. The immediate goal of Wayne County officials was to offset the total cost of holding the foreclosure auction in a ballroom in downtown Detroit.

Sales of properties in the foreclosure auction of nearly 200 transactions reached more than $250,000. Industry experts said that public tax foreclosure auctions are good in terms of bringing in quick cash. However, the events do nothing to prevent or control the blight in neighborhoods.

Some proponents of change said that it would be better for Detroit and other cities across the country that are experiencing a declining growth, to phase out tax auctions. They believe that a land bank program is the right way to reduce the number of foreclosure properties. The program allows selling of more valuable homes through mortgage brokers to entice new residents.

Dallas foreclosed homes for sale still floods the Texas housing market. For this month, nearly 6,000 foreclosure houses are scheduled for auction, representing an increase of 34 percent compared with last year.

For the first 9 months of this year, the number of foreclosure properties hit 51,000. Industry experts said that in previous years, the wave of foreclosures were caused by homeowners who borrowed risky loans, requiring no or low down payment and adjusting to exorbitant rates later. Lenders are also to blame for encouraging borrowers even if they are not creditworthy.

Experts said that the first wave of foreclosures was confined only to a certain group of borrowers. However, they pointed out that the next wave of foreclosures reflects the worsening economic condition not just in Texas but across the country. Many of troubled homeowners have lost their jobs or reduce their income. The rising unemployment rate resulted to more Dallas foreclosed homes for sale as indicated by the rise in the number of foreclosed homes placed on auction this month.

However, only about 50 percent of distressed properties placed for sale monthly are actual foreclosures. In many cases, lenders and borrowers have reached an agreement that gave homeowners an opportunity to save their properties from foreclosure or the repossession action is delayed.

Statewide, the highest increase in foreclosure rate was posted in Collin County. According to data, foreclosure filings increased by 61 percent to 778 homes compared with the numbers scheduled for foreclosure auction in October the previous year.

In Denton County, foreclosure filings jumped by 42 percent to 710 compared with a year ago. Similarly, Tarrant County posted a 43 percent rise to 1,975 while Dallas County foreclosure filings increased by 20 percent to almost 2,477.

But industry experts noted that the actual number of foreclosure this year dropped by 17 percent compared with last year. They said that this could mean that some federal programs aimed at preventing the spread of foreclosures are starting to show results.

One of the most popular federal programs is the loan modification. The Obama Administration has been offering incentives to lenders to motivate them to work with homeowners to find ways to save their properties from foreclosures.

Industry experts said that the loan modification program, despite its slow start, is on its track to reduce the number of Dallas foreclosed homes for sale.

An increasing number of volunteers find foreclosure homes to clean up thus preventing them from ruining the curb appeal of neighborhoods.

According to industry experts, in some areas where foreclosure rates are highest, such as Florida and Nevada, volunteering to clean up abandoned and vacant properties is becoming common in communities. These volunteers mend fences, cut grass, fix windows, clear away the rubbish and other works that would help prevent the unoccupied properties from becoming blights and attracting vandals and criminals.

According to officials of the National League of Cities, local residents are taking the matter of neglected foreclosure homes seriously because they are also affected by the presence of many dilapidated houses. Studies showed that home prices and values are dropping rapidly in neighborhoods with high foreclosure rates.

Some residents took the time out from their busy schedules to find foreclosure homes before they could fall into complete disrepair and attract criminals and vandals. Foreclosure homes that are not maintained can become eyesores or drive away potential buyers.

Furthermore, neglected foreclosure houses can pull the entire neighborhoods into disrepair, resulting in costly repairs. Some cities have implemented tough measures to prevent foreclosure homes from deteriorating.

In Cape Coral, Florida, code enforcement officers are also acting as property managers. The city started tracking foreclosure properties since June 2007. So far, about 5,234 lawns located on abandoned and vacant houses were mowed by city workers with the help of volunteers who do not want their areas to look unsightly.

Some cities that are initiating cleanup projects are charging property owners for the services done. However, many property owners could not be contacted resulting to cities shouldering the cost of property repair and maintenance.

According to industry experts, the major problem is the long gap between the time homeowners abandon their houses and the time banks take over the properties.

So far, about 350 cities across the country have passed ordinances that require banks and property owners to maintain foreclosure properties on their portfolio.

In Boston, Massachusetts, volunteers are also helping distressed homeowners avoid losing their homes to foreclosures. They conduct weekly door-to-door visit to inform homeowners and tenants at risk of foreclosures that many programs are available for free that can help them remain in their properties.

Industry experts said that initiatives to find foreclosure homes to clean up are an effective way to alleviate the impact of the foreclosure crisis.

Brooklyn foreclosed homes for sale under $300,000 are expected to swamp the New York housing market. Results of a recent market study showed that the foreclosure crisis has severely affected multi-family buildings located in low income neighborhoods in Brooklyn.

The study showed that 80 percent of repossessions filed in Brooklyn since last year was for mortgage loans below $1 million. Additionally, 51 percent of non-home mortgage loans were for residential buildings. The report also noted that majority of foreclosed units were located in low-income neighborhoods like East New York and Bedford-Stuyvesant.

Industry experts said that potential investors and homebuyers could expect a lot of bargain-priced brownstones in the coming months. Many of these three-unit or four-unit Brooklyn foreclosed homes for sale are priced below $300,000.

However, investors and homebuyers who are interested for good deals in prime communities and neighborhoods, like Park Slope or Carroll Gardens, may have to wait for a bit longer. A market report showed that 51 percent of mortgage loans (non-residential) that started foreclosure proceedings last year were for residential buildings. Meanwhile, 80 percent of mortgages were for properties below $1 million.

Industry experts said that low-priced neighborhoods are seeing a flood of foreclosures that sell way below the market price. For example, an eight-unit building located in Crown Heights could be had for as low as $400,000, which is half its original market price.

Furthermore, market data showed that 21 percent of walk-up apartments received foreclosure filings while 14 percent of filings were posted on mixed-use units and not more than 5 percent were filed on elevator apartment buildings, vacant land, retail and office buildings.

According to industry experts, more than 1,000 commercial properties are in some stage of foreclosure process in Brooklyn from September last year to September this year. For September 2009 alone, foreclosure proceedings on commercial properties totaled 70, a whopping increase from 25 foreclosures posted for the same month last year.

Experts said that based on lis pendens data, distressed sales may occur in Brooklyn in the next 20 months. They said that the flood of foreclosed small residential buildings in Brooklyn is a result of a great number of landlords buying into the housing market during the period of easy financing.

They said that because financing could be obtained easily, many of these small-time landlords bought any property they could lay their hands on.

Home prices in Texas continued to drop, albeit at a slow pace, partly due to the flood of Fort Worth foreclosed homes for sale that glut the market. Recent market data showed that pre-owned home prices dropped by 1.2 percent two months ago, compared with the same month in 2008.

According to industry experts, the August home price decline was the smallest annual drop. Month-to-month figures showed a rise in home prices for six consecutive months. August home prices in both Dallas and Fort Worth were the highest since September of last year.

The statistical trend prompted industry economists to hope that the market is now heading towards the right direction. However, they are not confident to say that the market has bottomed out. They said that current developments are not enough to conclude that the housing market is on the way to real recovery.

Economists said that the housing market could only take a breather from the flood of Fort Worth foreclosed homes for sale if the increasing unemployment rate could be reigned in and the economy would start to show stability.

Meanwhile, property prices in August across the country dropped by 11.3 percent compared with a year ago. However, market data showed a rise from July home prices which gave more hope to industry economists that property values across the United States are starting to bottom out. August improvement in home values was the seventh straight month of positive trend in the housing market for this year.

Industry economists pointed out a relative improvement in the rate of home price decline. They said that the biggest drop in annual home prices in August occurred in Las Vegas, Nevada which saw a decline of 29.9 percent and Phoenix, Arizona which dropped to 1.9 percent compared with August 2008.

Meanwhile, analysts pointed out bad loan decisions, recession and speculations as some of the major influences on the continuous drop in home prices. They said that the current trend has created an opportunity to home buyers, especially first-time buyers who availed of the federal tax credit program.

They added that the housing market, from here on, bears watching because of the discounted prices and the growing competition for cheap foreclosure houses.

The number of Denver foreclosures for sale is expected to grow by as much as 3.5 million in the next two years. This is the bleak prediction of industry experts as they noted the increasing number of homeowners who lost their jobs or have reduced their income.

Market data showed that 2009 will surpassed the number of foreclosure filings posted in 2007 and 2008. Additionally the number of actual foreclosures is accelerating on a steady pace. Colorado’s foreclosure rate is not the highest in the country but it is one of the top ranking states with high foreclosure rates.

Industry experts said that the foreclosure crisis has become a major factor hindering the recovery of the housing market. This is because low-priced foreclosure homes are pulling down prices and values of neighboring houses. But they pointed out that many smart investors and first-time buyers have taken advantage of the situation and flocked to the Colorado market to buy low-priced Denver foreclosed homes for sale.

Experts said that the foreclosure crisis is a tragedy beyond compare for many homeowners, but has created a unique opportunity for some. Because of the low-priced foreclosure homes, many sellers were forced to reduce prices of their properties on the market to be able to compete with foreclosure properties, thus making Colorado a buyer’s market.

Industry experts said that interested investors and first-time buyers can still take advantage of the low-priced foreclosure properties in the area. However, experts said that prospective buyers should always keep in mind that buying distressed properties is different from purchasing a new house or one that is not foreclosed.

They advise prospective buyers to take some time learning about the foreclosure market in the area where they plan to buy. Also, they should take note of where they can buy cheap foreclosure properties in good condition. Properties sold through short selling are some options that buyers can take when choosing a foreclosed home to buy, experts said. Short selling means lenders are agreeable for homeowners to sell their distressed properties at prices less than the amount of mortgage they owed.

It is hard to tell how far the number of foreclosure homes will go up. But most experts agree that the economy is nearing bottom, adding that potential buyers should act now while low-priced foreclosure homes are still flooding the housing market.

Stockton foreclosed homes for sale did not increase in number in September as expected by buyers and brokers, as banks controlled the release of their foreclosed properties, according to research firm Trendgraphix and realtors in San Joaquin County.

Because of the decreased number of foreclosures released by banks, the total number of homes for sale in September dropped by almost 70 percent to 1,158 units, a substantial drop from more than 5,100 units released to the market in September last year.

Consequently, the median home sales price in September remained at $160,000, the same as the August median.

Home loan broker Jerry Abbott explained that there will be no significant change in the home sales price if foreclosures are not released by lenders to the market.

Some realtors and housing analysts however contend that banks have been trying to respond to stepped up efforts by federal agencies to increase loan modifications. Abbott said that foreclosures will increase in 2010 when homeowners who obtained modifications will redefault and when recently laid off borrowers cannot find jobs quickly.

Over the past year, Stockton foreclosed homes for sale and foreclosures from nearby cities dominated the San Joaquin housing market, but foreclosure sales slowed as the pace of short sales increased.

In September, a total of 453 pending short sale contracts and 492 pending foreclosure sale agreements were signed.

Realtors also observed that sales of non-troubled homes have been rising. A total of 319 pending sales of previously owned homes were signed in September, comprising one-fourth of the housing market.

According to Ben Balsbaugh, head of a real estate business in Stockton, the increase in conventional sales was driven largely by investors flipping properties. He said that about 90 percent of conventional sales are flips – when investors buy homes, make quick improvements and then resell them quickly at a profit.

Based on data from Trendgraphix, the median price for non-distressed pre-owned homes sold in September in San Joaquin County was $215,000. The median price for foreclosure homes was $142,000 while the median price for short sales was $170,000.

According to an online foreclosure research firm, the cities which were most battered by foreclosures at the start of the crisis, such as Stockton, Cleveland, Modesto, Toledo, Detroit and Columbus, slowed down in foreclosure activity in the first 6 months of this year while other cities not previously considered hot spots increased in foreclosure activity.