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In Midst of “Recovery,” Sobering News

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RainyDay_SSG_Robert_Stewart_CCFlickrEven as the economic comeback continues in fits and starts, reports on the state of bankruptcies and mortgage delinquencies suggest we may not be ready to break out the champagne.

The most recent reality check comes from a survey by FindLaw.com, which found that nearly one in eight Americans, or 13% of adults, has either declared bankruptcy or seriously contemplated it. In 2010, 1.5 million Americans declared bankruptcy, the highest number since 2005, according to the National Bankruptcy Research Center.

More sobering news comes from the Center for Responsible Lending, which found in a recent report that 4.8 million Americans are at risk of losing their homes to foreclosure. Though that’s down from just under 6 million at the end of 2009, it’s still not very good news.

The current numbers translate to one in nine homeowners being at risk, compared to one in 32 back in the first quarter of 2003, just as the housing bubble was starting to inflate, Center for Responsible Lending’s spokesperson Kathleen Day told us in an email. The center defines “at risk” as being more than 60 days delinquent on payments or already in foreclosure.

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Image: SSG Robert Stewart, via Flickr.com

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