According to an article on Marketwatch.com, the default rate on modified mortgages is a shocking 25% after just one modified mortgage payment and nearly 50% over all.  This differs from the FDIC's loan modification assumption of a 33% default rate.

Full Story:

Half of modified mortgages default again

Interesting opinion piece on Bloomberg.com today that proposes some foreclosure mitigation ideas that are fairly different from all the other ideas floating around right now.

Bloomberg.com Opinion Piece:

How to stop the flood of foreclosures

With Citi, Fannie Mae and Freddie Mac all announcing foreclosure prevention plans yesterday, we've decided to compile a resource outlining all of the private lender foreclosure relief plans in one place:

Lender based foreclosure relief programs

If you are currently in foreclosure or are concerned about your ability to avoid foreclosure, you should check to see if your mortgage holder is offering foreclosure prevention help.  In many cases, lenders are offering pre-qualified mortgage modification that will allow you to both stay in your home and protect your credit score.  However, you must be proactive and act before it is too late.

We will keep the resource updated as more banks roll out foreclosure relief programs.  If there is a program that you are aware of that we are missing, please let us know.

The foreclosure rate in Wyoming, which is bolstered by an economy centered around the energy industry, remains one of the lowest in the nation.  Only 255 homes in Wyoming were in any stage of foreclosure in the 3rd quarter of 2008.

Full Story:

Wyoming foreclosure rate 44th in the nation

Following in the steps of Bank of America's Countrywide division, JP Morgan announced measures on Friday to help halt foreclosures on mortgages it owns. 

Foreclosure will be halted for 90 days while the bank determines policies to work with borrowers. 

More details from the New York Times:

JP Morgan places 90 day halt on foreclosures

Bloomberg reports that the Treasury and FDIC are working on a plan to use $50B of the $700B bailout package to guarantee up to $500B in mortgages and second-mortgages.  The plan is to be structured in such a way that it will provide an incentive to lenders and loan servicers to modify the terms of mortgages and keep struggling homeowners in their homes.

Its too early in the process to have much in the term of details, but the full Bloomberg article can be read at the following link:

Treasury and FDIC working on foreclosure avoidance plan

A lot of people are confused about what exactly a short sale is and whether or not a home has to be in foreclosure in order to have a short sale.

Quick answer is that you don't necessarily have to be in foreclosure to have a short sale - if you owe more than you can get for your house, regardless of whether or not you are current on your mortgage, you are short. 

Boston.com explains the situation pretty clearly.  Be sure to check out the reader comments too - there is valuable insight there as well.

Short sales and foreclosure explained

Time's published an interesting article regarding the recent push towards calling for mortgages to be modified to stave off more foreclosures.  They point to a number of studies on the efficacy of such mortgage modifications. 

Do loan modifications work?

Mortgage modifications to reduce foreclosures - are you for or against them?

A compromise has already been reached on evicting renters from foreclosed properties in Chicago.  As of now, renters will have 120 days or to the end of their lease, whichever is shorter, to vacate a rental property in foreclosure.

Finally some positive numbers on the home sales front.  September home sales in Southern California were up 65% year over year in September.  The big news within those numbers though is that over half of the sales were on foreclosure properties. 

In places like Southern California, where job growth is still stable, people are starting to recognize the current slump as a major bargain buying opportunity.  Now the real test is to see if these sales numbers hold up and start to put a bottom in place on prices.  October could be challenging as it will be the first month to fully factor in the recent credit market woes. 

More reading:

Bloomberg's take on Southern California's September home sales numbers

Hudson and Marshall will be auctioning 400 homes in Atlanta on October 24th, 25th and 26th.

The Atlanta foreclosure auction schedule is as follows:

October 24th - 75 Atlanta homes
October 25th - 189 Atlanta homes
October 26th - 114 Atlanta homes

Open House from 1-3pm Saturday and Sunday October 18th and 19th.

Auction Terms:
Title insurance provided by the sellers
$2,500 deposit required for all winning bids
All homes sold as is
Reserve Auction

To view a full list of properties and/or start bidding visit Hudson and Marshall's Website

Cook County Sheriff Tom Dart is taking a stand with Chicago renters by refusing to evict them from properties facing foreclosure.

A fascinating take on the foreclosure crisis from a man right on the front lines.

Why Chicago's sheriff refuses to evict renters

The Wall Street Journal has a post today that supports anecdotal reports coming in that many foreclosure auctions are now experiencing low participation from investors.  A large part of the problem is that while real estate prices are declining in many markets, the banks' price expectations are not.

Post includes a video of a New Jersey foreclosure auction with interviews with foreclosure investors.

WSJ: Foreclosure Auctions Facing Problems

Bank of America has announced an $8.5B plan to help Countrywide borrowers avoid foreclosure.

Options available under the plan include locking in subprime teaser rates for 5 to 10 years, switching to interest only loans, or switching to a fixed APR as low as 3.5%.

Full Story:
Countrywide Foreclosure Avoidance Plan

Maricopa County, Arizona foreclosure listings set a new record with 2,210 new notices in one week in mid-September. 

One scary thing about the figures is that the number of new foreclosure notices out-paced the total home sales in the county during the same period.