Nevada mortgage foreclosure rate rises

The rate actually went up so much in the first quarter that Nevada, unfortunately, managed to top all other states for the dubious honor. The number of home loans in foreclosure grew 0.32% to reach a total of 1.16% of all mortgages in Nevada, according to the Mortgage Bankers Association. The other high-ranking states are Arizona, California and Florida.

What's intriguing about the results is that if these four states are left out of the report, the statistics for the entire nation would've shown a decline. These states were invaded by real estate speculators a few years ago and now that the market has considerably softened, many of them are walking away from homes with falling values. Just abandoning them.

There's another concern. It's estimated that around 2 million ARMs will reset in the next two years to higher rates. Many of these belong to subprime borrowers who were attracted to the mortgage programs by low teaser rates, but after the initial two or three years the rates will climb steeply, causing payment shock. More foreclosures probably will come from this segment in the coming months.