Interesting article from the Wall Street Journal about the rise in foreclosures. The author claims the foreclosures will rise through April, but then they will start to decline. I believe the author is a bit optimistic. He is neglecting the upcoming Option ARM and Alt A ARM resets (recasts).
You can see we have between $500 billion and a Trillion of mortgages resetting or recasting in the next two years. Also, we have an enormous number of delinquencies, which are being messed up with the government’s modification program. The graph below isn’t pretty. The number of homeowners 90 days delinquent or already in foreclosure is higher than it was during all of 2008 and 2009.
I think reality checks are in order for housing bulls.