NEW YORK (CNNMoney.com) — The robo-signing controversy is just another issue that the already sluggish housing market didn’t need — but most analysts do not think it will have far-reaching impact.

Nevertheless, the housing market still faces many problems: a weak economy, sluggish hiring, tight mortgage underwriting, falling home prices, and slowing sales.

Then there’s the potentially disastrous number of foreclosures that may occur over the coming years.

“The market faces much bigger problems than the robo-signing issue,” said Mike Larson, a housing market analyst for Weiss Research.

Prime among them are declines in home prices. And while cheaper homes are good for buyers, they also speak to a housing market that won’t stabilize.

Fiserv, a market analytics company, has scaled back its home price projections considerably. In February, it forecast national price gains of about 4% through the end of 2011. The company’s latest prediction is for a 7.1% drop in prices between June 30, 2010 and June 30, 2011.

In fact, after five months of gains, prices in the 20 largest metro areas fell 0.2% in August, according to the latest S&P/Case-Shiller report.

The good news is, “There’ll be no vicious, self-reinforcing spiral down,” according to Mark Zandi, chief economist with Moody’s Analytics.

But, he added, “more home price declines are coming.”

He’s forecasting another 8% drop in home prices through the third quarter of 2011, which will put the total peak-to-trough decline at 34%.

Even after that, in 2012, he sees very little price growth.

Home prices continue to fall because sales aren’t taking off. Without buyers, the market can’t bottom out.

New home sales continue to languish around historic lows, barely exceeding an annual rate of 307,000. Existing home sales did rise to a 4.53 million annualized rate in September, up 10% compared with a month earlier, but are still well below the boom years.

Of course, nobody is buying homes when they can’t find jobs. And still more people can’t hang on to their homes because they’re out of work.

Nearly a million homes are expected to be repossessed this year, and analysts seem to be competing to issue the most dire forecast for future foreclosure numbers.

• Morgan Stanley reported that about 3.1 million borrowers are seriously delinquent with many expected to lose their homes.
• Zandi said more than 4 million are in trouble with half of those expected to go to foreclosure.
• And Laurie Goodman, of Amherst Securities, estimates the number of homes in danger of foreclosure at a whopping 11 million.
• Real estate analyst Kyle Lundstedt of LPS Applied Analytics said serious delinquencies will continue to spike and will not return even to the current rates — which are already at peak levels — until late 2012 or early 2013.

“The housing market is very fragile,” said Goodman.

However, Zandi sees a few factors that are positive.

These include: Low interest rates; FHA, Fannie Mae and Freddie Mac all lending to qualified buyers; and an improving job picture.

Zandi is especially confident that the employment picture is about to brighten. Corporate profits have spiked and, historically, hiring follow profits — with a lag of eight to 10 months. That means companies should start hiring workers very soon, Zandi said.

And once Americans start returning to work, they’ll find home prices are very reasonable. Housing is the most affordable it’s been since the pre-boom years. During the boom, Zandi said, prices were overvalued by about 50%; today it’s close to zero.

That has attracted many investors, including foreign buyers. They’ve been scooping up single-family-homes and condos in hard-hit markets like Florida, the Southwest and the Midwest and renting them out.

“The reason they’re in these markets is because they see value,” said Zandi.

But, he added, “If they see the robo-signing issue continue, they could begin to exit the market. If they do, there could be more price declines. That’s one reason why a foreclosure moratorium could be destructive.”

source: money.com

California tied with Massachusetts and New Jersey last month for having the highest credit score in the nation, according to a report released today by CreditKarma, a San Francisco firm that monitors consumer credit.

The three states had an average credit score of 684, ahead of the national average of 666. San Diego County was near the top of the list for major metropolitan areas, with a score of 686, according to a separate study of metro areas released last month.

The worst scores were located in the South. Alabama, Kentucky, Louisiana, Mississippi, Oklahoma, South Carolina and Tennessee all had scores below 650. Arkansas was the worst, with an average score of 636.

Nationwide, most states have substantially improved their credit scores over the past year as consumers pay down debt – and as banks continue to be highly selective in making loans and issuing credit cards.

“We suspect this focus on financial responsibility will ultimately lead to credit scores increasing again,” said Ken Lin, the firm’s chief executive.

Since the beginning of the year, seven states have cut their credit card debt by 10 percent or more:

• Indiana and Tennessee, decreased debt by 10 percent
• Oregon, 11 percent
• Nevada – decreased credit card debt by 12 percent
• Hawaii and Idaho, 13 percent
• Wisconsin, 28 percent

In California, credit card debt dropped 6.9 percent, from $7,891 per customer to $7,345. In San Diego, it dropped 3.6 percent, from $7,151 to $6,896. source: sign on san diego