The mortgage market mess continues to pummel Maryland, with foreclosure filings in the third quarter leaping 65 percent higher than during the quarter before, a new report shows.
Maryland households drew 8,340 filings during the period making the state the 16st worst in the nation, according to numbers released Wenesday by data provider RealtyTrac.
District numbers jumped a drastic 900 percent during the third quarter with 331 filings, the city is still in better shape than much of the country.
When ranked among the 50 states, D.C. placed 37th in number of filings-per-household.
Virginia ranked 21st in the nation with 7,718 foreclosure filings — a 55 percent increase over the previous quarter.
“Although not all areas are being hit as hard as others, the rise in foreclosures is quite widespread, with 45 out of the 50 states documenting year-over-year increases in the third quarter,” RealtyTrac CEO James Saccacio said in a written analysis.
When compared to the same time last year, filings are up 448 percent in Virginia and 549 percent in Maryland. The company did not have reliable data available for the District during that time period.
Analysts attributed the jump to the swelling number of adjustable-rate, subprime mortgages where rates are now resetting upward — a problem predicted to grow in coming months.
Borrowers with thin or shaky credit histories who took out adjustable-rate mortgages — which lenders were doling out freely two years ago during the housing boom — are defaulting on payments now as their low initial two-year fixed interest rates expire, pushing up their payments.
“People started to realize this was happening in the first half of 2006 — that’s when they stopped,” said John McClain of the George Mason Center for Regional Analysis. “But with interest rates re-setting after 24 months, it’ll be end of 2008 before we get out of this.”
In the D.C. metro region, foreclosure rates have consistently been lower than in other large cities. The D.C. area had the nation’s second-lowest foreclosure rate among the nation’s 15 largest metropolitan areas during the first half of 2007, according to the center.
The center will release its third quarter analysis this month.
