In fall 2011, Princeton University's Woodrow Wilson School conducted a large-scale mail and web survey of Mercer County residents. The survey focused on social and economic issues facing residents, including housing issues such as current mortgage debt and foreclosure experiences. While the overall rate of foreclosure filings in the county was lower than the national average, the county still felt the effects of the housing slump. Of the 64,000 owner-occupied housing units in Mercer County that have a mortgage or loan, 4.7% had received a foreclosure notice since August 2006, while 1.5% of mortgage housing units were in foreclosure proceedings. Still others are at risk of foreclosure due to late payments or having homes worth less than the debt owed.

Highlights of the survey include:

Those who purchased their homes at the peak of the market when the subprime mortgage lending was highest were more likely to face foreclosure. Minorities and those with lower incomes were more heavily affected.  

·        While 16% of mortgage housing units in the county were purchased between 2004 and 2006, these units accounted for 34% of all foreclosure notices issued since 2006.  

·        Mortgage housing units purchased between 2004 and 2006 were nearly three times more likely to have received a foreclosure notice than mortgage housing units purchased either before or after this period (10% vs. 4% respectively).

·        Mortgage housing units with a black, non-Hispanic household member were three times more likely to have received a foreclosure notice since 2006 than units with a white, non-Hispanic household member (10% vs. 3% respectively).  

·        Mortgage housing units with a Hispanic household member were five times more likely to have received a foreclosure notice than units with a white, non-Hispanic household member (15% vs. 3% respectively).  

·        Mortgage housing units with annual household incomes of less than $50,000 were four times more likely to have received a foreclosure notice than those with annual incomes of $50,000 or more (14% vs. 3% respectively).  

Many households that did not receive foreclosure notices may still be at risk because they are behind in their mortgage payments or have a house that is “under water” – worth less than the mortgage owed.   As with foreclosures, minority and low-income households are more likely to be in these categories.

·        4.5% of mortgage housing units were behind on their monthly mortgage payments – although only half of these had received a foreclosure notice. Almost half (45%) of those behind on payments were behind four or more months.

·        11.3% of mortgage housing units had “underwater” mortgages, although only a small percentage (12%) of those had received foreclosure notices.  

·        While 35% of mortgage housing units in Mercer County were purchased between 2004 and 2011, these units accounted for 65% of all “underwater” mortgages. Those purchased between 2004 and 2006 were four times more likely to have an “underwater mortgage” than units purchased in 2003 or earlier (25% vs. 6% respectively), and those purchased between 2007 and 2011 three times more likely to have an “underwater mortgage” than units purchased in 2003 or earlier (18% vs. 6% respectively).   

·        Mortgage housing units with either a black, non-Hispanic or Hispanic household member were nearly three times more likely to have an “underwater mortgage” than units with a white, non-Hispanic household member (25% vs. 9%; 28% vs. 9%   respectively).  

·        Mortgage housing units with annual household incomes of less than $50,000 were nearly twice as likely to have an “underwater mortgage” than mortgage housing units with annual incomes of $100,000 or more (17% vs. 9% respectively).  

Christina Paxson, dean of the Woodrow Wilson School, said of these results, “Despite reports that the housing market is rebounding, many in Mercer County are still hurting. It is particularly troubling that those on the lower end of the income scale and minority families have been hardest hit. We need to be watchful in the coming year to see if these issues improve or get worse. We hope to continue this type of survey so we can continue to analyze the situation.” 

A full copy of the report can be read here.