[Source: Alan Zibel, Associated Press] — The nation’s foreclosure crisis is centered in four states. But taxpayers across the country will feel the pain of bailing them out. California, Florida, Nevada and Arizona generated about half of all foreclosure filings nationwide last year, according to RealtyTrac Inc., even though residents in those states hold just a quarter of U.S. mortgages. Since mid-2007, skyrocketing foreclosures in those states have been magnifying the national rate.
As lawmakers prepare to spend up to $100 billion in financial bailout money on a sweeping foreclosure prevention plan pushed by President-elect Barack Obama, the discrepancy is adding another layer to a problem already confounding economists, politicians, and homeowners.
Just this week, RealtyTrac, an Irvine, Calif.-based foreclosure listing service, reported that more than 2.3 million American homeowners faced the loss of their homes last year, an 81 percent increase from 2007. And Goldman Sachs chief economist Jan Hatzius said in a report that the number of unsold homes on the market is so large that prices are likely to keep falling by an additional 20 percent to 25 percent by mid-2010. But there’s more to it than that. The Sun Belt states now in trouble are the same ones that for decades have taken jobs and residents from states in colder climates…
The risky loans that were prevalent in Las Vegas and Phoenix are “just completely foreign” to North Dakotans, said David Flynn, an economics professor at the University of North Dakota. [Note: To read the full article, click here.]