While homeowners who default on a mortgage due to economic hardship, such as a job loss or divorce, normally must wait two to five years before buying a home again, walkaways may face double that time.

Walkaway, meaning those who voluntarily walk away from their home loan. For example, say you owe $600,000 when you house is only worth $300k, and you walk away from the debt and let the bank foreclose on you. It can take you up to seven to eight years to be in a position to buy a home again.

Credit scores are just one component of a complete credit decision. Future underwriters will scrutinize your records very closely and if they see no precipitating factors leading to the default, for example, no job loss, no health issues, then the repaired credit score won’t overshadow the black mark of a walkaway.

That is not to say you can’t get a loan. YOu might be able to put might have to pay a premium for it as well. Or be charger a higher interest rate to qualify.

Foreclosures in the month of January was 15% compared to the same month last year. But it is predicted that this number is going to dramatically increase as a surge of cash-strapped homeowners who have fallen behind were on their way.

More than 315,000 homeowner received a foreclosure notice in January. That is less in December (349,000). In January, one in 409 homes were sent default notices

anuary marked the 11th straight month with more than 300,000 properties receiving a foreclosure filing. The numbers could stay above that level as unemployed homeowners who have tried to keep up with their mortgages finally start missing monthly payments.

Mortgage financier Fannie Mae reported in late January that the rate of borrowers who have a conventional loan on a house and are seriously delinquent was 5.29 percent in November, more than doubling the rate of 2.13 percent in November 2008. Borrowers are considered seriously delinquent if they are past due by three months or more, or are in foreclosure.

The dip in January’s numbers may be due to processing delays by lenders during the end-of-year holidays, said Rick Sharga, senior vice president of RealtyTrac, which is based in Irvine, Calif.

Slowing the foreclosure rate is a key step in the recovery of the real estate market and the overall economy. The foreclosure crisis forced the federal government and several states to come up with plans to prevent or delay the process to help delinquent borrowers.

Foreclosed homes are usually sold at steep discounts, so they often lower the value of surrounding properties. Cities lose property tax dollars from foreclosure homes that sit empty and from declining home values, straining local economies. Home prices have stabilized in some cities, but are still down 30 percent nationally from mid-2006.

Economic issues, such as unemployment or reduced income, are expected to be the main catalysts for foreclosures this year. Initially, subprime mortgages were mostly the culprit, but homeowners with good credit who took out conventional, fixed-rate loans are the fastest growing group of foreclosures.

Among states, Nevada posted the nation’s highest foreclosure rate, followed by Arizona, California, Florida and Utah. Rounding out the top 10 were Idaho, Michigan, Illinois, Oregon and Georgia.

The metro area with the highest foreclosure rate in January was Las Vegas, with one in every 82 homes receiving a foreclosure filing. It was followed by Phoenix and the California cities of Modesto, Stockton, and Riverside-San Bernardino-Ontario.