Southwest: Worst Default Epidemic.(Statistical data)

NEW YORK -- The nation's foreclosure epidemic continues unchecked with homeowners in the Southwest feeling the worst effects. Squeezed by high-energy prices, climbing interest rates, and aftereffects from creative financing, thousands of homeowners have been forced into foreclosure.

With two months left in the fourth quarter, foreclosures are already up 19.6% over all of 2005 - 766,058 foreclosure filings for 2006 vs. 640,457 for all of 2005; according to ForeclosureS.com, a northern California-based real estate investment advisory firm and publisher of foreclosure property information.

"Even though energy prices have tumbled from recent highs, it's too late for over-extended homeowners who used creative financing to buy homes they couldn't afford," says Alexis McGee, president of ForeclosureS.com.

"That sub-prime ARM or interest-only home loan may have seemed like the perfect solution back when the monthly payment was low, but now those payments have 'adjusted' up. A 2% rate increase can double a payment overnight," says Ms. McGee. "Combine that rate shock with the home appreciation and sales slowdowns, and homeowners without enough equity to refinance or sell their homes. Foreclosure is their only option."

Three Southwest states, California, Texas, and Colorado, have among the highest foreclosure numbers in the nation. ForeclosureS.com reports California's 117,560 foreclosures are already up 45% over all of 2005 total 80,989 filings. Texas shows 90,620 ...