In all, 154 out of 206 metropolitan areas with at least 200,000 residents posted an annual increase in foreclosure activity between January and June.

Notices for defaults, scheduled home auctions and home repossessions are all warnings that can lead up to a home eventually being lost to foreclosure.

The latest figures show the threat of foreclosures is spreading well beyond the top tier of metropolitan areas located in California, Florida, Nevada and Arizona, which have borne the brunt of the fallout from the housing crisis.

Those states saw housing values surge during the housing boom years. When the boom ended, values collapsed and foreclosures soared.

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.

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.

There are more than 30 states that allow owners of these notes to go after you if they were not able to sell your home for what was owed on the mortgage. These states include, New York, Florida, and Texas.

Some states, such as California, are “non-recourse” and don’t allow deficiency judgments. But, even there, if the original loan was refinanced, some or all of it may be subject to claims.

So make sure you ask for a release from the bank.

Otherwise, you could be face with a lawsuit and harassing letters from collectors because in the next few years, banks will be selling many of these types of accounts to collection agencies and other third parties, at discount.

So there are two things you should take from this: (1) ask for a release and (2) read all your paper work carefully when you agree to allow the bank to take back your home. Make sure you don’t agree or acknowledge any debts because your home is going to be sold for less than what you owe on your mortgage.

The Judge called the banks actions “harsh, repugnant, shocking and repulsive.   So the Judge decided to punish the bank by wiping out $291,000 in principal and $235,000 in interest and penalties.

The couple who been paying only interest on their mortgage and had no equity in their home.  They had begged the bank to let them restructure their loan.  The bank refused to work out a deal and eventually foreclosed on the property.  After the foreclosure, the couple manage to get Court to allow a settlement conference.

The Judge canceled the debt because the bank “must be appropriately sanctioned so as to deter it from imposing further mortifying abuse against [the couple].”

The bank is involved in a similar case in California, where it’s trying to foreclose on an 89-year-old woman, despite two court orders telling it to stop.  So who is this bank.  Its the OneWest bank which is owned by a private equity group.

1.  Carefully calculate your price and don’t get caught up in a bidding war.

2.  Contact the Lenders Directly.  The asset manager at the banks can give you inportant information.

3.  Get pre-approved by the lender you want to buy from

4.  Most bank owned properties (REO) are sold as is.  Banks usually don’t maintain or fix up the property.  So consider buying a home that needs some work.

5.  Get a real estate attorney to review all the documents.

6.  Take your time to make an offer.  Talk to the selling agent to find out when you should put in a bid and for how much.

7.  Visit the property with a contractor to see what needs to be done to fix up the places and figure out if there are any structural problems with the property.