2009 Record Year For Foreclosures

It's official: 2009 was the worst year ever for foreclosures.

A record 2.8 million properties were hit by foreclosure, according to a new report by RealtyTrac, the Irvine, Calif.-based research firm. That's up 21 percent from 2008, and 120 percent from 2007.

The company reports that half of this carnage comes from just four states -- California, Florida, Arizona, and Illinois, which, together, saw 1.4 million homes make their way onto America's Boulevard of Broken Dreams.

Don't expect the bad news to stop any time soon. RealtyTrac's chief executive officer, James Saccaccio, didn't sound an optimistic note in announcing the year end data. "In the long term, a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond as lenders gradually work their way through the backlog."

The AP reports that in Illinois, one in every forty homes foreclosed during 2009. RealtyTrac predicts that the nation's foreclosures could hit 3 million this year.

But could 2010 be a tipping point, the year when foreclosures peak and start to diminish? Some economists and industry observers believe foreclosures will peak in 2010 before their levels start falling. Kenneth Rosen, chair of the Fisher Center for Real Estate at the University of California at Berkeley, said so in a Bloomberg interview, citing stabilizing employment and housing prices. The MBA (Mortgage Bankers Association) has also pegged 2010 as the end of the decline.

Let's hope they are right.

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