Foreclosure Rate Hits the Roof

The number of US home loans entering foreclosure reached an all-time high in the second quarter, a new survey shows, and delinquencies are up to more than 5% of all mortgages. Trouble with adjustable-rate mortgages—an outgrowth of the subprime crisis—is driving delinquencies, CNNMoney reports, with seven Midwest and Sun Belt states the most problematic areas.

Some states, like Michigan, are suffering from serious economic problems and falling employment rates; states like California are rebounding from over-speculation on a once-hot market. Without those seven states, the report says, foreclosures would be actually be down nationally. President Bush addressed the ARM problem last week, but if the housing slump continues, foreclosure figures will keep rising. (More housing market stories.)