Foreclosures rise in July
The latest foreclosure numbers carried a mixed message: They’re up 3.6% from the month before but down 9.7% from 12 months earlier.
In July there were more than 325,000 foreclosure filings — including notices of default, auctions notices and bank repossessions. That is the 17th month in a row total filings exceeded 300,000, said RealtyTrac’s CEO.
“Declines in new default notices, which were down on a year-over-year basis for the sixth straight month in July,” he said, “have been offset by near-record levels of bank repossessions, which increased on a year-over-year basis for the eighth straight month.”
A near record number of people lost their homes to mortgage payment problems in July. Lender repossessions amounted to 92,858 homes, the second highest monthly total ever behind the 93,777 recorded this May.
Repossession is the final stage in the foreclosure process. People can stay in thier homes until the point that the bank takes posession of the home or sells it at auction
Don’t foreclose and ruin your credit contact www.california-shortsale.com today.
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Short sales soar in California, U.S.
Sales of homes for less than the amount of their outstanding mortgage debt have tripled since 2008, particularly in California and the Sunbelt, according to a report released Tuesday.
Known as short sales, the increasingly common transactions for financially troubled homeowners are projected to balloon to 400,000 in 2010, according to Core Logic, a Santa Ana company that provides services to the real estate and mortgage markets. By comparison, existing homes sold at a seasonally adjusted annual rate of 5.37 million units in June, according to the National Assn. of Realtors. In an economy in which jobs are scarce and a quarter of homeowners owe more on their property than it’s worth, short sales are appealing to investors, banks and owners as a cheaper way out than foreclosure.Such sales will likely remain routine as the mortgage industry attempts to stabilize, according to the report from Core Logic.
Through short sales, lenders and struggling homeowners agree the property will be sold at a loss, allowing the seller to escape crushing debt or the stigma of default. But in the process, the sellers watch their credit scores suffer and the funds they invested in down payments and renovations disappear. And with fluctuating home prices, lenders can be reluctant to approve short sales. The transactions can be a hassle to execute, especially when multiple loans on a home mean a slew of creditors are included in negotiations. Also, lenders have been burned in some short sales when they agreed to a below-market sale price only to see the property resold later at a significantly higher price. Still, even though the number of short sales is still relatively small, the increase shows that lenders now view the transactions as “a good compromise between foreclosures and trying to ride out the market,” said Richard K. Green, director of the USC Lusk Center for Real Estate. The number of transactions has exploded to more than 160,000 in 2009 from roughly 96,000 the year before. More than a quarter of the transactions occur in California, with another quarter split between Arizona, Texas and Florida. About 4% of short sales are then resold within 18 months, according to Core Logic. The firm studied the short sales of more than 250,000 single-family residences over the last two years. Short sales, Green said, could actually end up boosting the job market. Unemployed homeowners who can escape underwater mortgages have an easier time moving around, expanding their job search. “In 2008, it was impossible to do these sales,” he said. “But there’s some regulatory pressure to get stuff off the balance sheet. And lenders are less in denial now, coming to grips with the reality that the economy isn’t going to snap back.”\Need expert advise on the shortsale of your home contact www.california-shortsale.com
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20% of mortgages are underwater
More than 20% of the nation’s mortgage borrowers owe more than their homes are worth.
At 21.5% for the third quarter, it is a small improvement over the previous quarter, when 23.3% of loans were underwater, according to real estate website Zillow.com.
This so-called negative equity is a hotly watched statistic because it is a prime predictor of foreclosure — second only to loss of income.
“It is the paramount challenge facing housing markets,” said Stan Humphries, Zillow’s chief economist. “We already have had record levels of foreclosure and, combined with high unemployment, negative equity is very toxic to the market.”
But don’t cheer about the slight gains in the past three months. Most of the improvement comes because so many people lost their homes to foreclosure
In some markets, residents were helped by improving home prices. As prices rise, it narrows the gap between what homeowners owe and what they could sell for. As a result, hard-hit metro areas such as Merced, Calif., and Orlando, Fla., recorded huge declines in the number of underwater borrowers. Merced was down to 40% while Orlando fell to 64.6%.
In fact, most markets trended up. Only 25 of 142 markets surveyed lost ground, led by Lansing, Mich., where negative equity grew to 31.5%.
Neighboring Detroit also worsened, jumping up to 31.4%, as did Grand Junction, Colo., where the it grew to 31.2%.
Las Vegas continued to lead the nation, with 73.9% of all mortgage borrowers owing more than their properties are worth. In Phoenix, that total is 66.8%; in Orlando, 64.6%; and in Reno, 61.9%.
Need help with your underwater mortgage contact www.california-shortsale.com
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Double-Dip Recession Threatens to Shave 20% off Home Prices
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“The risk of a double-dip recession is rising. We believe the odds of a near-term double dip recession have increased from nearly one in five this spring to closer to one in four,” they wrote in a research report released Monday.
And they warn that if the economy sinks back into recession, housing activity will follow. If such a scenario were to play out, Moody’s says home prices are likely to fall by another 20 percent before they stabilize in early 2012 – a full year later than the company’s baseline outlook of a 5 percent drop before leveling off in early 2011.
Moody’s says the economic recovery is losing momentum with retail, housing, manufacturing, and most importantly the job market having weakened in recent weeks. Real GDP, which grew 5 percent annualized during the fourth quarter of 2009, has slowed to half that pace in the second quarter of this year, the ratings firm explained.
“This rate is below the economy’s potential, and we expect unemployment to drift back up into the double digits,” Moody’s said in its report.
All this contraction bodes badly for housing markets, where oversupply and muted demand have home prices fettered, and weak economic conditions, especially rising unemployment, are making it harder and harder for borrowers to keep up with their mortgage payments.
Moody’s says foreclosures pose a major downside risk, with another vicious spiral of defaults and property repossessions a possibility.
The company’s analysts say the success of the Home Affordable Modification Program (HAMP) is vital to squashing this possibility, but it has been progressing slowly and a number of borrowers are simply too deeply troubled to benefit from a loan modification.
If the recent revisions to HAMP – including principal-reducing modifications and forbearance for unemployed homeowners – do not produce more substantial results, Moody’s says foreclosures will exceed already-elevated projections, leading to an even sharper drop in home prices.
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12% of O.C. homeowners underwater
One in eight of Orange County single-family homeowners who have a mortgage owed more than their home was worth in the quarter that ended on June 30, online real estate website Zillow.com reports.
That’s 12.08% of O.C. homeowners still making house payments — tens of thousands of households at a minimum given that there are over 470,000 homes of all types (including condos) that have a mortgage.
Still, that’s an improvement:
- Zillow reported that 14.32% of of all single-family homes with mortgages were “under water” or had “negative equity” in the first quarter.
- The quarter before that — Q4 2009 — 14.44% were under water.
- At one point, four out of every 10 homes bought during the housing boom was under water.
- Nationwide, 21.5% of U.S. single-family homeowners with a loan was under water in the second quarter. That’s down from 23.3% in the first quarter and 23% a year earlier.
- In the Los Angeles region (which includes Orange County), 16.9% of mortgage-paying house owners were underwater, which tied for 82nd out of 125 metro areas.
Worst in the nation:
- Don’t even look at these next two numbers if you own homes in Las Vegas or Phoenix. They had the nation’s highest negative equity rates, with (DON’T LOOK!) 73.4% and 66.8% of the house owners under water, respectively. Those are the worst two metro areas in the nation.
- Eight other metro areas had underwater rates of 50% or greater: Orlando (64.6%); Reno (61.9%); El Centro (57.5%); Modesto (57.5%); Lakeland, Fla. (55.7%); Port S. Lucie, Fla. (55%); Stockton (53.5%); and Fort Myers, Fla. (51.9%)
Contact www.california-shortsale.com if you find yourself in this scenario.
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Mortgage Rate Falls Under 4.5 %
Freddie Mac reports that long-term mortgage rates moved south again this week.
Interest on 30-year fixed loans hit a new low of 4.49 percent, compared to 4.54 percent last week and 5.22 percent a year ago; and the 15-year mortgage landed at 3.95 percent, down from 4 percent last week and 4.63 percent a year ago. Five-year adjustable-rate mortgages reached a new low of 3.63 percent, down from 3.76 percent last week and 4.73 percent a year ago; while one-year ARMs fell to 3.55 percent from 3.64 percent last week and 4.78 percent a year ago.Need help with gettin the lowest rate on a loan contact www.california-shortsale.com today for free quotes.
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Foreclosure activity increases nationwide
A new report shows 154 of the 206 U.S. metropolitan areas with a population of 200,000 or more posted year-over-year increases in foreclosure activity. The report by RealtyTrac® also showed nine of the 10 metro areas with the highest foreclosure rates experienced declines. Four states—Florida, California, Nevada, and Arizona—accounted for the top 20 metro foreclosure rates. Florida led the way, with nine of the top 20 metro foreclosure rates, followed by California with eight, Nevada with two, and Arizona with one.
With 4.59 percent of its housing units (one in 22) receiving a foreclosure filing, Modesto, Calif., posted the nation’s third highest metro foreclosure rate. Other California cities in the top 10 were Merced at No. 4 (4.47 percent of housing units); Riverside-San Bernardino-Ontario at No. 5 (4.37 percent); Stockton at No. 6 (4.37 percent); and Vallejo-Fairfield at No. 9 (3.91 percent). Don’t let your house foreclose and damage your credit contact www.california-shortsale.com for help.
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Record Lows Continue for Mortgage Rates
The 30-year fixed mortgage rate fell to a new low of 4.54 percent this week from 4.56 percent last week and an average of 5.25 percent a year ago.
The 15-year fixed loan rate also hit a record low of 4 percent, down from 4.03 percent a week ago and 4.69 percent last year. The five-year adjustable-rate mortgage averaged 3.76 percent, compared to 3.79 percent last week and 4.75 percent a year earlier; and one-year ARMs averaged 3.64 percent, down from 3.7 percent and 4.80 percent, respectively.Need help with getting the lowest rate on a loan contact www.california-shortsale.com
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It’s a Great Time for Housing Deals
Paying off an underwater mortgage and buying a better home could be the best tactic in this troubled market.
“If you are trading up, what better time than when interest rates are at record lows and the cost of the trade-up is much less than it used to be?” says Christopher J. Mayer, a Columbia Business School economist. With 15-year fixed-rate mortgages at about 4.5 percent, it also makes sense to pay off the mortgage and keep the house. “At this point,” says Jay Brinkmann, chief economist of the Mortgage Bankers Association in Washington, D.C., “if they don’t have anything else that is bringing a tremendous return, then they are buying themselves an annuity by paying their house off sooner than they needed to.”Post by California Short Sale Solutions from California Short Sale Solutions
California Foreclosures Drop to 3-Year Low
The number of home owners in California entering foreclosure in the second quarter dropped to a three-year low, according to research firm MDA DataQuick.
Default notices, the first step in the foreclosure process, fell 43.8 percent in the second quarter compared to the same period last year. Analysts say the decline is due to banks pushing loan-modification programs and short sales. Also, fewer homes are underwater thanks to a recovery in home prices, so a smaller number of home owners are walking away. Ironically, regions of the state where homes are cheapest are most likely to see the highest number of default notices. According to DataQuick, neighborhoods with a median sales price of less than $300,000 experienced 10.6 default notices for every 1,000 homes, while neighborhoods with prices above $800,000 accounted for 2.9 notices for every 1,000 homes.Need help with a shortsale of your property contact www.california-shortsale.com
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