Is 10 percent the new five percent when it comes to unemployment rates just like 50 is the new 30 in age? Roy Oppenheim says, maybe so.
As the index of leading economic indicators shows signs of life, including an increase in new housing starts and in Florida an increase in residential housing sales, it seems odd that no one is noticing that 10 is the new five.
The unemployment rate in the state of Florida just last week hit 10 percent. This is also the number of people in the United States who are at least one month behind on their mortgage payments. And in Florida, 10 percent is the number of people that are actually in the process of foreclosure.
Only just a few short years ago all of these percentages were at five. Five percent unemployment and less than five percent of households that held mortgages were behind in payments. Not even five percent of the population was in foreclosure.
Well that was then and now is now.
The last time the United States had a 10 percent unemployment rate was in 1982; the year I was graduating from college. That is along time ago.
The trouble is that with increasing unemployment, banks will not consider loan modifications if the borrower does not have a job or income. That may come as a surprise to many since a lot of homeowners got their mortgages without showing any income to the bank. However, this time around is more like a ‘bate and switch.’ The rules have changed and guess who ends up holding the bag: YOU!