Thursday, 02 February 2023

Foreclosures rise again in third quarter

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LAKE COUNTY – Foreclosure rates around California continue to reach record levels, with foreclosures also continuing to climb in Lake County. {sidebar id=28}


A report released late last month by DataQuick Information Systems of La Jolla said that mortgage lenders started formal foreclosure proceedings on a record number of California homeowners in 2007's third quarter quarter, which resulted from declining home prices, sluggish sales and subprime mortgage distress.


A total of 72,571 Notices of Default – a notice given to a borrower that if they do not make payments by a certain deadline their property will be foreclosed on – were filed during the July-to-September period, according to DataQuick. That's up 34.5 percent from 53,943 during the previous quarter, and up 166.6 percent from 27,218 in third-quarter 2006.


Because a residence may be financed with multiple loans, last quarter's 72,751 default notices were recorded on 68,746 different residences, DataQuick reported.


In Lake County, Notices of Default in the third quarter numbered 129, up 20 over the second quarter of this year and 92.5 percent higher than the third quarter of 2006, in which there were 67 Notices of Default.


“That would be a record,” said DataQuick spokesman Andrew LePage.


In Sonoma County, Notices of Default rose 224 percent from last year, with Trustee Deeds jumping more than 500 percent. For Napa County, Notices of Default were up 279 percent over last year, and Trustee Deeds were up 720 percent.


Statewide, recorded Trustees Deeds – which marks the actual loss of a home to foreclosure – totaled 24,209 during the third quarter, the highest number in DataQuick's statistics, which go back to 1988, LePage reported.


Last quarter was up 38.7 percent from 17,458 for the previous quarter, and up 604.8 percent from 3,435 for last year's third quarter, according to DataQuick. The peak of the prior foreclosure cycle was 15,418 in third-quarter 1996, while the low was 637 in the second quarter of 2005.


In Lake County, there were 53 Trustee Deeds in the third quarter, a 342-percent increase over the third quarter of 2006, in which there were 12 Trustee Deeds, said LePage. That's another record, as it's also up from the 48 Trustee Deeds in 2007's second quarter.


Since 1996, the average number of Trustee Deeds filed in a given quarter was 16, LePage said.


“As long as the Notice of Default number is increasing, you're likely to see an increase in the number of foreclosures,” LePage explained.


On primary mortgages statewide, homeowners were a median five months behind on their payments when the lender started the default process. The borrowers owed a median $10,914 on a median $344,000 mortgage.


"We know now, in emerging detail, that a lot of these loans shouldn't have been made,” said DataQuick President Marshall Prentice. “The issue is whether the real estate market and the economy will digest these over the next year or two, or if housing market distress will bring the economy to its knees. Right now, most California neighborhoods do not have much of a foreclosure problem. But where there is a problem, it's getting nasty.”


E-mail Elizabeth Larson at This email address is being protected from spambots. You need JavaScript enabled to view it..


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