Families in New Jersey and throughout the country are struggling to keep up to date on mortgage payments. About 7.7 percent of all mortgages in the United States are either behind in payments or in foreclosure. The foreclosure crisis has even affected people living in the wealthiest neighborhoods. A recent study has shown that not even the residents of wealthy neighborhoods in northern New Jersey have been able to stop foreclosure.
A common reason for foreclosures in these areas is likely to be loss of income. But wealthy home owners are often more savvy financially, so many may have decided to walk away from a home as a strategic decision. The long process of foreclosure in New Jersey may also be a contributing factor in the high foreclosure inventory in the region. In New Jersey, for example, it takes 976 days to foreclose, compared to the national average of 336 days.
In a survey of the 100 richest zip codes in America, two New Jersey zip codes ranked in the top 10 for foreclosures. The Northeast as a whole has the most wealthy zip codes with high foreclosure rates.
Of course, most individuals facing foreclosure do not live in such wealthy areas, and they do not view the loss of their home as a strategic move. For the majority of New Jersey residents, foreclosure usually comes at the end of a long struggle to make ends meet. And home loss has been a particularly worrying concern for residents who have experienced sudden illness or unemployment.
Unfortunately, the tough economy and weak housing market show few signs of recovering any time soon. It seems that a new federal initiative is announced almost weekly to stave off foreclosure, and yet many still suffer from debt spiraling out of control and are not sure which way to turn for help. In some cases, bankruptcy protection may offer an opportunity to stop creditor harassment while devising a plan to achieve financial security once again.
Source: Forbes, “Rich Neighborhoods Riddled With Foreclosures,” Morgan Brennan, Nov. 14, 2011