While new home loans increase, so do foreclosures
While new mortgage loans are on the rise in Maine, foreclosures have continued their upward trend at a "modest" pace, according to state officials.
A new analysis from the Maine Bureau of Financial Institutions found that Maine's 32 state-chartered financial institutions originated 5,302 mortgage loans during the second quarter of 2009, a 45% increase from the low point during the fourth quarter of 2008 when only 3,657 mortgage loans were originated. Lloyd LaFountain, superintendent of the bureau, said in a statement that he was "encouraged by the sharp increase" in new home mortgage loans.
However, foreclosures continued to increase during the second quarter of 2009. The state-chartered banks and credit unions held 85,811 home mortgage loans at the end of June. Of those loans, 260 were in the process of foreclosure, or one loan for every 330 mortgages. That's a 40% increase compared to the 186 foreclosures in the second quarter of 2008, and an 8% increase from the number of foreclosures in the first quarter of 2009. LaFountain said foreclosure activity in Maine appears lower than in many other states and "does not threaten the solvency" of Maine-chartered banks and credit unions.
The bureau has been surveying state-chartered banks and credit unions regarding foreclosure activity since October 2006.
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