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Housing Slump Expected To Continue Through 2012

Notary Signing Agents and other Notaries working in the housing industry should consider expanding their notarial service offerings in 2012 because a slow economy and the ongoing foreclosure difficulties will drive mortgage lending next year to its lowest point since 1997, according to the Mortgage Bankers Association.

The MBA’s latest forecast, released this month, projects that total originations for 2012 will total around $936 billion, a 25-percent decline from this year. This is a far cry from the industry’s peak of more than $3 trillion in originations in 2005.

MBA Chief Economist Jay Brinkman said the sluggish economy and high unemployment rates were the key factors in the latest forecast. He also noted that our economy could be hurt if Europe’s current financial crisis pushes the region into recession.

Complicating the outlook, the MBA said about 30 percent of potential homebuyers are either denied a mortgage or drop out of the process because of tighter lending requirements.

Several research organizations have noted that the large volume of homes in delinquency or foreclosure are driving prices down, making it harder for home buyers to lock into a deal. The result is that overall demand remains soft while inventories are high.

That trend is likely to continue. Foreclosure activity in the third quarter of 2011 broke a nine-month downward slide driven by the “robo-signing” crisis, according to RealtyTrac CEO James Saccacio. “Lenders are cautiously throwing more wood into the foreclosure fireplace after spending months trying to clear up sloppily filed foreclosures.”

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