George Wolf
Sep 2,2010
In: Foreclosure

Default Notices Go High as Foreclosures Go Low

Default notices go high as foreclosures go low.

One main indicator that there is trouble in mortgage trouble is that there has been a record-high hit within the Bay Area inside the second quarter, as stated in a report of real estate that was released last Wednesday.

Default notices that have been sent to those delinquent on home loans came to a total of almost 20,000 for regions of nine counties within the months of April until June, as released by a data company of real estate in San Diego. This would be a very clear distress sign within the market and it happens to have hit a very high level.

One analysis of ZIP codes regarding default notices within the Bay Area shows that a lot of the largest increases could be found within areas of higher cost. Towns ridden with foreclosures like Antioch still came with high default concentrations; however, they have slightly decreased compared to last year.

At the same time, these kind of affluent county towns in Contra Costa like Danville, Lafayette and Walnut Creek have seen important rises within default notices, although the amount would still be quite low. Distress seems to be creeping in, as well as intensifying within neighborhoods that are more expensive.

The 19,983 default notice within the Bay Area reflected a slight 7.3% increase compared to the exact same quarter within the previous year. These notices would be the initial formal step within the process of foreclosure. Around 62% of notices of default end within home bank repossessions.

Default notices have also risen in California when compared to last year. 124,562 could be found within the second quarter, higher by around 2.4 percent compared to last year. However, the amount of notices within California have fallen by 8 percent in comparison with the initial quarter that year, back when the state actually had a record of around 135,431 of these notices.

Real foreclosures of the bank have declined both statewide and locally, probably due to lenders gearing up in order to handle tons of loan modification requests.

The 6,929 foreclosures within the Bay Area reflected a drop of 25.4 percent compared to last year’s second quarter. On the same note, the 45,667 state foreclosures were down by 27.9 percent from last year’s period.

Foreclosures seem to have gone down this year since lenders have regrouped right after numerous moratoriums and started implementing the plan of Obama’s administration for loan modifications in order to aid in keeping borrowers within their homes. Their slowness has been criticized by lawmakers.

Around 325,000 borrowers all around the nation have received offers of loan modification since this plan kicked off in March; however, this is only a part of these homeowners that have found themselves in foreclosure.

A lot of borrowers have reported incredible frustration with the process of loan modification.

At the direction of the servicer, they have been working on short sales for around two-thirds of whatever it is that they owe. When lenders do not approve such sales, they will do deeds in place of foreclosure.

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