Families worried about credit reports

A startling report of the U.S. Foreclosure Index says that once Freddie Mac and Fannie Mae and a few other mortgage lenders lifted the politically forced moratoria on housing foreclosures, the number of foreclosures in March rose 44 per cent from February’s record high. Reasons cited were rising unemployment, a backlog of foreclosures during the freeze, and increased abandonment of properties.

The only reason for the moritorium was banks didn’t want homes empty, abandoned, and frozen in the winter. Most would need to be re-plumbed.

Slowly, we are starting to get a glimpse of what much of the world will look like in a decade or so. Families are worried about what their credit reports may look like in a month or two.

HSBC now has a moritorium on being nasty after a short sale. HSBC will wait one year before going after money owed by former homeowners if there is a shortfall. On the other hand, HSBC and other credit card companies may want higher monthly payments. There is no money in household budgets for that either.