Foreclosure filings jumped sharply in July, with more than 36,000 homes affected nationwide. That’s 11 percent higher than June and 13 percent above last year, according to ATTOM. Rising home prices are keeping some owners afloat, but growing numbers are finding the pressure too much to handle.

Nationwide, one in every 3,939 homes received a filing. Nevada led the country with one in every 2,326 homes in trouble, followed by Florida, Maryland, South Carolina, and Illinois. Among large metro areas, Houston topped the list, with Jacksonville, Las Vegas, Riverside and Cleveland close behind.

Though getting lower, the main driver has been interest rates. A 30-year mortgage now averages 6.58 percent, more than double what it was four years ago. Adjustable loans in particular are leaving borrowers exposed, and filings have risen steadily all year. At the same time, more homeowners are falling “underwater,” owing more than their property is worth. That share hit 2.7 percent in the second quarter, up from 2.4 percent last year, with Louisiana and Kentucky among the hardest hit states.

Lawmakers recently stepped in to strengthen protections for veterans, who face higher foreclosure risk and make up a large share of the homeless population. The new law aims to give them a stronger safety net when times get tough.

There is one bright spot: the typical monthly mortgage payment dipped to $2,631 in early August, its lowest in seven months. Still, with filings rising and rates staying high, the market sits on shaky ground. In my view, the next stretch will show whether this trend snowballs or steadies out with small relief like lower payments.

Source Inspiration: ZeroHedge