US mortgage defaults reach record high

March 6th, 2009 - 5:18 am ICT by IANS  

Washington, March 6 (DPA) Lenders are taking back homes in the US at a record pace as families can’t afford mortgage payments, a industry report said Thursday indicating the country’s housing crisis deepened further at the end of last year.
The Mortgage Bankers Association (MBA) said 3.3 percent of all mortgage-holders were in foreclosure at the end of 2008 - up 126 percent from a year ago - and 7.88 percent were behind on at least one monthly payment.

Both numbers were the highest ever recorded since MBA’s records began in 1972.

US housing prices have plummeted nearly 20 percent in the past year and more than eight million people now owe more money on their mortgages than their property is worth.

The downturn has cost financial institutions more than $1 trillion in mortgage-related investments and plunged the wider US economy into a deep recession.

President Barack Obama Wednesday launched a $75-billion effort to reduce the mortgage payments of up to nine million homeowners.

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