Risk of foreclosure up in Cumberland County

August 8, 2012 at 3:01 pm

The Fayetteville Observer reports today on the growing number of homeowners in Cumberland County that have fallen behind on their mortgages and are at risk of losing their homes. The article reports that although the foreclosure rate is down overall since the mid-1990s, the number of foreclosures increased 73 percent in the first half of 2012. This means 417 homes had been sold at auction due to homeowners defaulting on their mortgages, and in June alone 17 percent of real estate closings in the county were foreclosed homes.

The underlying reason for this increase is persistent economic problems. The county has an unemployment rate of 10.3 percent, compared to a statewide unemployment rate of 9.4 percent. Long-term unemployment and underemployment (when a worker has a job, but it does not pay enough to cover expenses) mean that more homeowners are unable to keep up with their mortgage payments.  One of the stories highlighted in the article shows that this is not just a problem for new homeowners. After being out of work for two years, a couple who had lived in their home for 20 years is now facing a deadline of 45 days to obtain a loan modification or face foreclosure.

The map below from the Federal Reserve Bank of Richmond shows the foreclosure rate for North Carolina Counties for the first quarter of 2012. It shows that Cumberland County, despite all its challenges, is not even the worst hit. Places like Brunswick, Warren, and Vance Counties have foreclosure rates of over 5.17 percent and as high as 11.50 percent. This again corresponds with high unemployment rates, which are shown in the second map.

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Entry filed under: Economic Development, Economy, Housing, Jobs & Employment. Tags: , , , .

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