Why so many foreclosed in beautiful city Denver, COLORADO ?

Answer 1

colorado is the one of few states that allow marijuana as a non offense if pulled over smoking


probably because they are all high

Answer 2

Overall, the Denver median income does not support the property values. The median home price in Denver is about $260K. However, the median income according to Wikipedia is only $39K (or $3,250 per month before taxes) which is extremely low compared to the rest of the country.

The mortgage payment on a $260K house with 5% down (and 5% down is a lot in CO, most people didn't put any money down while buying houses during the past few years when no money down mortgage programs were popular) at a 7% interest rate is $1,643. When you add in taxes and insurance, the total payment will be about $2,000. Therefore, Denver residents are over-extended because their housing payments are approx. 62% of their pre-tax income (not to mention all their additional consumer debt), whereas, you should never have your housing be more than 38% of your income.

Therefore, when your housing expense is already 62% of your income and something bad happens, i.e.: health emergency, job loss, mortgage rate adjusts, divorce, etc. You won't be able to pay your mortgage and you will go to foreclosure.

Answer 3

Why so many foreclosed throughout the United States. Many mortgage lenders( seperate entities of banks) used the gimmick of 1% rate for a period of time (AMR) after which the rate would esculate to Prime plus. So houses were sold at the low rate which the buyer could afford on the outstanding balance. The 1% stops and the 5% kicks in making the mortgage payment four times higher which put many above their ability to pay resulting in foreclosure.

Answer 4

extended credit beyond ability to pay