One in 10 with a mortgage face foreclosure

One in 10 American households with a mortgage was at risk of foreclosure this summer as the government's efforts to help have had little impact stemming the housing crisis.

About 9.9 percent of homeowners had missed at least one mortgage payment as of June 30, the Mortgage Bankers Association said Thursday.

That number, which is adjusted for seasonal factors, was down slightly from a record-high of more than 10 percent as of April 30.

In a worrisome sign, the number of homeowners starting to have problems with their mortgages rose after trending downward last year. The number of homes in the foreclosure process fell slightly, the first drop in four years.

More than 2.3 million homes have been repossessed by lenders since the recession began in December 2007, according to foreclosure listing service RealtyTrac Inc. Economists expect the number of foreclosures to grow well into next year.

The number of Americans missing payments and falling into foreclosure has followed the upward trend in unemployment, which has been near double digits all year and has shown no sign of dropping soon.

"Ultimately the housing story, whether it is delinquencies, homes sales or housing starts, is an employment story," Jay Brinkmann, the trade group's top economist, said in a statement. "Only when we see a consistent increase in employment will we see an increase in sales and starts, and a sustained improvement in the delinquency numbers."

There was some modestly encouraging news. The percentage of mortgage borrowers receiving foreclosure notices fell slightly to 4.57 percent in the April-to-June quarter. That's down from 4.63 percent in the January-to-March period and the first drop in four years.

And the percentage of loans receiving their first notice of foreclosure also dipped. That fell to 1.1 percent in the second quarter from 1.2 percent in the first quarter.

Besides forcing people from their homes, foreclosures and distressed home sales have pushed down on home values and crippled the broader housing industry. They have made it difficult for homebuilders to compete with the depressed prices and discouraged potential sellers from putting their homes on the market.

Government efforts haven't made much of a difference. Nearly half of the 1.3 million homeowners who have enrolled in the Obama administration's main mortgage-relief program have been cut loose through July, the Treasury Department said last week. The program is intended to help those at risk of foreclosure by lowering their monthly mortgage payments.

Roughly 32 percent of those who started the program have received permanent loan modifications and are making their payments on time.