JONESBORO, AR (KAIT)-
Effects from the nationwide mortgage meltdown brought about by subprime loans seem to be plaguing states like California, Florida and Nevada.
Feeling less of an impact are some southern states, including Arkansas. Foreclosure rates in Craighead County have been down over the past couple of years.
The Craighead County Clerk's office says they've processed 77 foreclosure notices since the start of 2008. Jerry Myers is with First Continental Mortgage in Jonesboro. He says when it comes to foreclosure rates, it depends on which county in Northeast Arkansas you're talking about.
While Craighead's fared pretty well, counties with a dwindling industrial base or high numbers of the unemployed are hurting.
"Some areas around Mississippi county, they're a little higher than some counties," said Myers. "Jackson and Poinsett counties, too."
Home prices have plummeted according to the Office of Federal Housing Enterprise Oversight, which, Tuesday morning, said that home prices reported their first annual decline in 16 years.
With a lessening in home prices, one might think it's a buyer's market. Well, not necessarily because as Myers says, lenders are leary of customers with bad credit.
"The situation has definitely tightened up for them because the mortgage industry has really realized that this is not a good deal to make folks with bad credit home loans because they haven't proved over the years that they're financially responsible," he said.
So, say you want to buy. What kind of credit score do you need?
Myers says it takes a 620 to get a conforming, conventional home loan.
As far as what the housing problems mean for the overall economy .... "There's nothing troubling about a gradual correction of home prices. If we keep our incomes at the current level and home prices go down we are richer, we can buy more housing." said founder of the S&P Case-Shiller Home Price Index, Robert Shiller. "On the other hand, if they fall suddenly and fast then that can bring on recession and that is the worry right now."
Shiller estimates the value of U.S. homes has eroded by about $1 trillion dollars in the nine years since the start of the housing boom.