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Florida Homeowners Still Struggling

With many individuals experiencing financial problems, officials are constantly hoping for signs of an economic turnaround. Unemployment and foreclosure rates are usually examined to determine if a particular state is moving in the right direction.

For Florida homeowners, the rebound may take longer than for those in other states. According to a recent report by RealtyTrac, Florida foreclosures actually increased in the month of July, which is the opposite of the overall U.S. foreclosure rate. Much of the increase was due to initial foreclosure filings, which kicks off the process against homeowners. This is just the first step in a very lengthy process that can last as long as two years.

One of the reasons so many families find themselves facing foreclosure is connected to the widespread decrease in the value of homes. Many homeowners purchased their homes when they were at peak values, only to see them drop dramatically after purchase.

Because of the decrease in value, a large percentage of Florida homeowners actually owe more than their homes are worth. According to Zillow.com, an internet real estate company, approximately one-third of South Florida homeowners are in underwater mortgages.

This could lead to further troubles for those unable to pay these mortgages. Individuals struggling with these payments may consider working with their lenders in an attempt to modify their mortgage terms. However, many companies are reluctant to agree to any changes in the initial agreements. Homeowners would continue to accumulate debt, and still be forced to pay extremely high mortgage payments.

Unfortunately, most homeowners do not address these issues until it is too late - making foreclosure a real possibility. There may be options available, including filing for bankruptcy. This could even potentially allow a family to remain in their homes while the process is pending.

Source: SunSentinal.com "Underwater mortgages still common in South Florida" Paul Owers, August 23, 2012.

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