SAN FRANCISCO - The number of US homeowners entering foreclosure climbed 75 percent in 2007 from a year earlier as mortgages became more difficult to refinance and falling property values made it tougher to sell.
More than 1 percent of US households were in some stage of foreclosure during the year, up from 0.58 percent in 2006, RealtyTrac Inc. said yesterday.
Home prices fell in 2007 for the first time in at least 40 years, and the number of mortgages available to homeowners dropped, creating concern the housing slump will hurt consumer spending and push the world's largest economy into recession.
Mortgage originations probably declined 14 percent to $2.34 trillion in 2007 compared with 2006, according to a forecast by Washington's Mortgage Bankers Association.
Home prices in 20 US metropolitan areas fell 7.7 percent in November, the 11th consecutive month of declines, according to the S&P/Case-Shiller home price index released yesterday.
Mortgage originations are expected to decline another 34 percent to $1.55 trillion in 2008, the mortgage bankers said.
A record $375 billion of subprime loans reset to higher payments in 2007 and another $340 billion will reset this year, said Bose George, an analyst at Keefe Bruyette & Woods Inc. in New York.
The number of homeowners in the United States entering foreclosure doubled in December from a year earlier, RealtyTrac said. For the year, more than 2.2 million default notices, auction notices, and bank repossessions were reported on about 1.3 million properties.
As many as 750,000 homes will go into foreclosure this year, adding to the supply of available homes, said Rick Sharga, executive vice president for marketing at RealtyTrac.
The Irvine, Calif., seller of foreclosure information has a database of more than 1 million US properties.
The median price of an existing single-family home dropped 1.8 percent in 2007, according to the National Association of Realtors.