[THS] California foreclosures up 327% from 2007 levels

[Peter Webster]

http://latimesblogs.latimes.com/laland/2008/04/california-fo-1.html


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California foreclosure "surge": Up 327% from '07 levels

Jz2tduncThe number of California homes lost to foreclosure in the first
quarter surged 327% from year-ago levels -- reaching an average of
more than 500 foreclosures per day -- DataQuick said in a report,
warning that the widening foreclosure problem could "spread beyond
the current categories of dicey mortgages, and into mainstream home
loans."

>From DataQuick's report on California foreclosures in the first three
months of 2008: "Trustees Deeds recorded, or the actual loss of a home
to foreclosure, totaled 47,171 during the first quarter. ...  Last quarter's
total rose 48.9 percent from 31,676 in the previous quarter, and jumped
327.6 percent from 11,032 in first quarter 2007."  That translates into
517 foreclosures every day in the first quarter of 2008.

DataQuick president Marshall Prentice: "The main factor behind this
foreclosure surge remains the decline in home values. Additionally, a lot
of the 'loans-gone-wild' activity happened in late 2005 and 2006 and
that's working its way through the system. The big 'if' right now is
whether or not the economy is in recession. If it is, the foreclosure
problem could spread beyond the current categories of dicey
mortgages, and into mainstream home loans."

>From The L.A. Times' Peter Hong: "Sinking home values and the
collapse of flimsy mortgages sent a record number of California homes
into the foreclosure process in the first three months of this year, a real
estate information service reported today."

Default notices -- which mark the beginning of the foreclosure process
-- increased sharply, but not as rapidly as outright foreclosures. From
Bloomberg News: "California mortgage defaults more than doubled in
the first quarter to the highest in 15 years as a drop in sales and prices
prevented some homeowners from selling their properties to pay debt,
DataQuick Information Systems said.

More: "Homeowners received 113,676 default notices in the first
quarter, up 143 percent from a year ago, La Jolla, California- based
DataQuick said today in a statement. The level was the highest since at
least 1992, when DataQuick's statistics begin."

Despite well publicized federal efforts to reach out to homeowners in
default, the odds that they will ultimately lose their homes appear to be
increasing. DataQuick reports that, of the homeowners in default, "an
estimated 32 percent emerge from the foreclosure process by bringing
their payments current, refinancing, or selling the home and paying off
what they owe. A year ago it was about 52 percent.: