The stormy Nevada housing market is about to be rocked by an impending tsunami of ARM (Adjustable Rate Mortgage) rate resets and a striking increase of activity in foreclosure and pre-foreclosure activity.
August saw a 44% increase in Notice of Default filings from July, with a total of 5,279 homes receiving a foerclosure-related notice in Clark County. Nevada, again outpaced the rest of the country by a solid 11% in these filings. This jump also reverses a six-month long trend in the decrease of filings.
In August, 1 in 118 homes in Clark County received correspondence from their lender regarding foreclosure proceedings, and that number is likely to rise. Why?
The Adjustable Rate Mortgages that have gotten so many homeowners into dire financial straits are ready to reset beginning October 1, 2011. These mortgages, issued during the peak of market-frenzy between 2004- and 2007, are currently valued at $750,000,000,000 USD. This is a tidal-wave of debt, looming over an economy that continues to limp.
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