Just how bad is the foreclosure situation? If you caught summaries of the latest delinquency and foreclosure numbers released by the Mortgage Bankers Association of America, you could only conclude: Yikes, it is getting scary out there.– The rate of American home loans entering the foreclosure process last quarter hit the highest it’s been in the history of the survey, which dates to 1953.

– In some states, the mortgage crisis is particularly severe. In Ohio, 5.2 percent of all home loans are now either three months past due or somewhere in the process of foreclosure. Michigan and Indiana are not far behind. In Michigan alone, 1 of every 100 houses saw foreclosure actions initiated in the three-month period covered by the survey.

Envisioning your dream home, complete with architectural drawings, is one thing. Financing it is quite another - especially in the current market.

“It’s going to be tough,” said Natasha Lovas of Triton Funding Group in San Francisco. “A lender is going to lend on the current value of the property. To find a lender willing to lend on the future value, you need to get a construction loan, where the rates are higher and the bank assumes a lot of control over the whole process.”