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Foreclosure Filings Are Up, Foreclosures are Down in San Diego – Why?

September 25, 2009 By

The number of pre-foreclosure filing in San Diego are on the rise while the number of properties that are actually becoming bank owned (been foreclosed) in San Diego and California is going down.  What is the cause of this?  One major reason for the rise in pre-foreclosure filings is the number of homeowners that have lost their jobs – unemployment is on the rise.  Without income, the homeowner will not be able to continue making their mortgage payments.  The reason the number of properties are going down at the same time more properties are getting pre-foreclosure filings is the banks are working out loan modifications or short sales to avoid having to take the properties back. The rise in forensic loan audits have become an effective tool to stave off foreclosure.  

We are not out of the woods yet.  The Fed just announced they will continue the discount rate at 0 to 0.25%.  This will help keep mortgage interest rates down.  If Congress agrees to extend the 1st time homebuyer tax credit beyond November 30, that will, as well, help continue the buying momentum that has helped stabilize prices. 
See below for the recently published article by Realtytrac.

Foreclosure starts hit new peak

RealtyTrac report shows drop in REO filings
By Inman News, Thursday, September 10, 2009.

The number of properties completing the foreclosure process and becoming bank-owned declined in August, but a record number of homes entered the foreclosure pipeline, data aggregator RealtyTrac said today.

The report shows there is still an “ample supply” of properties in the foreclosure pipeline, even as the outflow of real estate-owned (REO) properties onto the resale market is more carefully regulated, said James J. Saccacio, chief executive officer of RealtyTrac, in a press release.

The 76,134 properties that became bank-owned in August represented a 13 percent decline from the high for the year seen in July — 87,258 — and a 16 percent decline from a year ago.

But a record 138,224 properties entered the foreclosure process in August when they were subjected to notices of default or lis pendens, up 3 percent from July and a 16 percent increase from a year ago. The number of properties subjected to auction notices in August — 144,113 — was also a new record, rising 4 percent from July and 53 percent from a year ago.

Thanks to the decline in REO properties, the total number of homes RealtyTrac was following through the foreclosure process declined by 1 percent from July to August, to 358,471, although that number represents an 18 percent increase from a year ago.

Nevada had the highest rate of foreclosure-related filings in August (one for every 62 homes), followed by Florida (1 in 140), California (1 in 144), Arizona (1 in 150), Michigan (1 in 234), Idaho (1 in 241), Utah (1 in 282), Colorado (1 in 329), Georgia (1 in 332) and Illinois (1 in 401). By comparison, one in every 357 U.S. homes was subjected to a foreclosure-related filing in August.

In terms of raw numbers, California had the greatest number of foreclosure-related filings (92,326), followed by Florida (62,401), Michigan (19,359), Nevada (17,902), Arizona (17,807), Illinois (13,078), Georgia (11,947), Ohio (11,368), Texas (11,261) and New Jersey (8,316).

Six states — California, Florida, Michigan, Nevada, Arizona and Illinois — accounted for 62 percent of all foreclosure filings, RealtyTrac said. The number of properties becoming REO dropped in all six states — including a 32 percent decline in California, a 15 percent drop in Illinois, and an 11 percent decrease in Nevada.

At the metro level, one in 53 homes in Las Vegas, Nev., was subjected to a foreclosure-related filing, the highest rate of any metro area with a population of at least 200,000. The Reno-Sparks, Nev., metro area also made the list of top 10 metro foreclosure rates, with one in 86 homes hit with a foreclosure-related filing.

The remaining eight cities on the top 10 metro foreclosure rate list were in California and Florida.

In California, Stockton had the nation’s second-highest metro foreclosure rate (1 in every 74 homes subjected to a foreclosure-related filing), followed by Merced (1 in 78), Riverside-San Bernardino-Ontario (1 in 80), Vallejo-Fairfield (1 in 82), Modesto (1 in 84), and Bakersfield (1 in 94).

In Florida, the Orlando-Kissimmee metro area made the top 10 with one in every 87 homes subjected to a foreclosure-related filing, along with Cape Coral-Fort Myers (1 in 88), RealtyTrac said.

There are three major milestones in the foreclosure process — an initial notice of default from the lender, a scheduled auction, and repossession by the lender. Not all homes that begin the foreclosure process are sold at auction or taken back by lenders, as some borrowers are able to refinance their loans or negotiate loan modifications or short sales with lenders.

Filed Under: Debt Crisis, Loan Modification, San Diego Short Sales, Short Sale, Uncategorized Tagged With: , , , , , , , , , , , , , , , , , , ,

Foreclosure Activity Remains Near Record Levels

September 18, 2009 By Leave a Comment

Homes being lost to foreclosure in San Diego, Califorina and nationwide have not slowed significantly according to the latest RealtyTrac report.   California continues to be one of the leading states for notices of default, foreclosures, and short sales.  Economists project that this market will remain for months to come and almost half of all homeowners will lose significant equity in their home.

You may be able to save the equity in your house using a forensic loan audit.  Apply today.

FORECLOSURE ACTIVITY REMAINS NEAR RECORD LEVEL IN AUGUST 2009

By RealtyTrac Staff   

 Foreclosure Activity Decreases Less Than 1 Percent From Record High in July

Activity Up 18 Percent From August 2008 Despite Year-Over-Year Drop in REOs

 IRVINE, Calif. — September 10, 2009 — RealtyTrac® released its August 2009 U.S. Foreclosure Market Report™, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 358,471 U.S. properties during the month, a decrease of less than 1 percent from the previous month but still an increase of nearly 18 percent from August 2008. The report also shows one in every 357 U.S. housing units received a foreclosure filing in August.

 “The August report demonstrates that there is still an ample supply of properties filling the foreclosure pipeline even while the outflow of bank-owned REO properties onto the resale market is being more carefully regulated,” said James J. Saccacio, chief executive officer of RealtyTrac. “After hitting a high for the year in July, REOs dropped 13 percent in August, but we also saw a record high number of properties either entering default or being scheduled for a public foreclosure auction for the first time.”

 Nevada, Florida, California post top state foreclosure rates

 With one in every 62 housing units receiving a foreclosure filing in August, Nevada continued to document the nation’s highest state foreclosure rate despite an 8 percent decrease in foreclosure activity from the previous month. A total of 17,902 Nevada properties received a foreclosure filing during the month, still an increase of 53 percent from August 2008.

 Florida documented the nation’s second highest state foreclosure rate, with one in every 140 housing units receiving a foreclosure filing, and California documented the nation’s third highest state foreclosure rate, with one in every 144 housing units receiving a foreclosure filing.

 A 10 percent month-to-month decrease in foreclosure activity helped lower Arizona’s foreclosure rate from the nation’s third highest in July to fourth highest in August. One in every 150 Arizona housing units received a foreclosure filing in August — still more than twice the national average.

 Six states account for more than 60 percent of national total

 Six states accounted for 62 percent of the nation’s total foreclosure activity in August despite decreasing REOs in all six states. California REOs dropped 32 percent from the previous month, but the state continued to post the highest overall total of any state, with 92,326 properties receiving a foreclosure filing in August. California’s total was down 15 percent from the previous month and was also down 9 percent from August 2009 — the first year-over-year decrease in California foreclosure activity in RealtyTrac’s monthly reports.

 A total of 62,401 Florida properties received foreclosure filings in August, the nation’s second highest state total and an increase of more than 10 percent from the previous month despite a 5 percent decrease in REO filings. Initial default notices in Florida increased 12 percent from the previous month, and scheduled auctions increased 13 percent from the previous month.

 A new law in Michigan requiring lenders to file a separate public notice of default before scheduling a foreclosure auction boosted overall foreclosure activity numbers in the state for August. A total of 9,789 of the new default notices were reported in August, bringing the total number of Michigan properties receiving foreclosure filings to 19,359 for the month — a 134 percent spike from the previous month and third highest among the states. Michigan’s foreclosure rate leapfrogged from 19th highest in July to fifth highest in August.

 With 17,902 properties receiving foreclosure filings in August, Nevada posted the nation’s fourth highest total despite a 24 percent decrease in REO filings from the previous month, and with 17,807 properties receiving foreclosure filings in August, Arizona posted the nation’s fifth highest total despite an 11 percent decrease in REO filings from the previous month.

 Illinois REO filings decreased 15 percent from the previous month, but the state’s total of 13,078 properties receiving foreclosure filings was still sixth highest among all the states in August.

 Other states with totals among the 10 highest in the country were Georgia (11,947), Ohio (11,368), Texas (11,261) and New Jersey (8,316).

 Three states dominate top 10 metro foreclosure rates

 Foreclosure filings were reported on 14,940 Las Vegas properties in August, one in every 53 housing units — more than 6.7 times the national average and the highest foreclosure rate among metro areas with a population of at least 200,000. The city’s foreclosure activity was down 11 percent from the previous month but still up 48 percent from August 2008.

 With one in every 86 housing units receiving a foreclosure filing in August, the Reno-Sparks metro area joined Las Vegas in the top 10, posting the seventh highest metro foreclosure rate.

 Six California metro areas documented foreclosure rates among the top 10 in August. Stockton posted the nation’s second highest metro foreclosure rate — one in every 74 housing units received a foreclosure filing — followed by Merced at No. 3 (one in 78), Riverside-San Bernardino-Ontario at No. 4 (one in 80), Vallejo-Fairfield at No. 5 (one in 82), Modesto at No. 6 (one in 84), and Bakersfield at No. 10 (one in 94).

 Two Florida metro areas documented foreclosure rates among the top 10: Orlando-Kissimmee at No. 8 with one in every 87 housing units receiving a foreclosure filing, and Cape Coral-Fort Myers at No. 9 with one in every 88 housing units receiving a foreclosure filing.

Filed Under: Debt Crisis, Debt Settlement, Mortgage Fraud, Real Estate Educational Materials, Short Sale, Uncategorized Tagged With: , , , , , , , , , , , , , , , , , , ,

Unemployment Now Becoming A Principal Reason for Rising Foreclosures

September 5, 2009 By Leave a Comment

unemploymentResearch by Moody’s Economy.com predicts that in 2009 1.8 million borrowers will lose their home to foreclosure.  This figure rises from 1.4 million homeowners in 2008.  Moody is a leading independent provider of economic, financial, country, and industry research.  Moody attributes the increase in foreclosure rate to the rise in unemployment. At the start of the housing crisis in 2007, the unemployment rate was about 4.6%. Last month it reached 9.4%.  Many believe it reach 10% by the end of the year.  This unemployment figure does not account for those self-employed individuals unable to collect unemployment, those that have a reduced wage, and those that have not given up. Other experts believe the true unemployment figure to reach closer to 15%.  In San Diego unemployment is predicted to hover around 11-12%

 As the start of the housing crisis, homeowners that had subprime loans were the first to lose their homes.  Now unemployment is the biggest factor driving foreclosures today.  ”It’s a much harder nut to crack, unemployment,” said Mark Calabria, director of financial regulation studies at the Cato Institute. “It’s much easier to bash lenders than to create jobs.” 

 In the first quarter of 2009, the prime loans rather than subprime loans accounted for the largest share of foreclosures. This shift is due almost entirely due to unemployment. Hope Now, a group of mortgage lenders backed by the government, has established a committee to look at how to best help unemployed homeowners facing foreclosure. One strategy involves creating new types of loan modifications. “We are going to be seeing more foreclosures because of prolonged unemployment,” said Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee. “These are people who weren’t in trouble and wouldn’t be in trouble if they hadn’t lost their job.”  The government has yet to reveal what this new type of loan mod would entail.

Filed Under: Debt Crisis, Loan Modification, Real Estate Educational Materials, Uncategorized Tagged With: , , , , , , , , , , , , , , , , , , ,

Real Estate Inventory Is Down – Are Banks Holding on to Bank-owned Foreclosed Properties?

September 2, 2009 By Leave a Comment

Since April of this year, every San Diego real estate agent, investor, loan officer and title/escrow company has noted that real estate inventory in San Diego has diminished significantly.  We spoke with one escrow company that does virtually all the closings for REDC, a large auction company in regards to this matter.  Her response was that business was down about 40% since April.  Banks appear not to be releasing their inventory.  Thus San Diego short sale listings are selling like hotcakes.

 Diana Olick, a CNBC Real Estate Reporter, reported an interview with Bank of America/ Countrywide on whether or not they are holding on to their bank-owned properties.  Here is how they responded (as summarized in her report):

Bank of America – Countrywide: 

  • Foreclosure sales have been abnormally low since we learned of the pending implementation of the administration’s Making Home Affordable program. From that point, we delayed the initiation of foreclosure proceedings and sales for customers that may eligible for a loan modification under MHA. As a result of this policy, our foreclosure sales in recent months have been as little as half the normal pace we experienced before.
  • Until a foreclosure is completed, Bank of America continues to exhaust every possible option to qualify customers for modification or other solutions.
  • Now that Making Home Affordable programs are operational, we do project an increase in foreclosures as we exhaust every available option to qualify customers for modifications and other solutions.
  • While we have very strong loan modification programs now available, unfortunately, these foreclosure projections reflect the increasing number of customers who will not qualify for loan modification because they have suffered major life events servicers can’t solve…primarily unemployment and underemployment.
  • We do not hold foreclosed properties off the market. The vast majority of mortgages serviced by Bank of America are owned by third-party investors. We have an obligation to them to prepare foreclosed properties for market and sell them as efficiently as possible.

 According to Ted Jadlos of LPS Applied Analytics, “Based upon foreclosure and REO timelines, it’s going to take at least 18 months to flush the system of our current problems. But to flush the problems in only 18 months, more problem loans need to leave the system relative to the new problem loans of today and tomorrow. That does not appear to be the case right now—we aren’t clearing faster than new problems are emerging.”
We feel that Bank of America – Countrywide is not exactly being above board on their “politically correct” response.  We know of many San Diego and Orange County homeowners who are not in a loan modification, haven’t made a mortgage payment for over 10 months, an still have not received a notice of default. It’s a great time to get out of your mortgage and your debt through the short sale of your home in San Diego.

Call us at 1 (619) 631-4546 to get started today!

Filed Under: Loan Modification, San Diego Short Sales, Short Sale, Uncategorized Tagged With: , , , , , , , , , , , , , , , , , , ,
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