Foreclosures to Persist

Not even one of the biggest government bailouts in history will immediately turn back the flow of home foreclosures and falling housing prices. Housing experts say foreclosures are likely to remain above historical norms until at least next summer as mortgages reset and home prices in some areas of the country continue to fall. One worry: Delinquencies, already a growing problem for subprime borrowers, are rising among prime mortgage borrowers. Nationally, foreclosures rose 12% in August from the month before and were up 27% from the year before, according to RealtyTrac. More than 2 million foreclosures on homes financed with subprime loans are anticipated from late 2008 to the end of 2009, according to the Center for Responsible Lending. An additional 40.6 million homes will drop in value because they are near foreclosed homes.