July 5th, 2011: Several financial sectors suggest economic stabilization and growth, but the nation’s housing market continues to dampen overall conditions, according to the credit bureau Equifax.
Equifax, based in Atlanta, has released the results of a study it conducted during the month of May analyzing national credit trends.
The company points to shadow inventory and REOs as the two major mortgage market depressors.
“Shadow inventory and real estate owned properties are still playing a dominant role in today’s mortgage market and slowing the pace of economic recovery,” said Craig Crabtree, SVP and general manager of Equifax Mortgage Services.
Equifax says shadow inventories are contributing to a continued rise in severe mortgage delinquencies and write-offs.
Total write-offs in 2010, including first mortgages and home equity installment loans, were $304.6 billion, whereas write-offs for 2006 and 2007 combined were $126.7 billion.
While REOs have fluctuated over the last few years, Equifax says they have been on the rise since March 2011, causing added strain to the nation’s economy.
Some estimates say shadow inventory exceeds 4 million properties nationally.
“Until these foreclosures are processed, the mortgage market will continue to impact economic growth,” Crabtree continued.
Equifax composes its monthly reports from data on more than 585 million consumers and 81 million businesses.
