Data showing people are falling behind on their mortgage payments soared from April through June. Actual foreclosures... not so much.
I've updated the graph showing Sonoma County Notices of Defaults (blue bars - borrowers are 60-90 days late on their mortgage) and Trustees Deeds Recorded (a signal homes were lost to foreclosure).
Notice of defaults continued to climb nearing all times highs. However, this did not translate into more foreclosures which only slightly nudged up.
These bad loans will have to be dealt with eventually. Notice that the last time NODs were at this level it led to 933 foreclosures in the 3rd quarter of 2008. That's nearly double the current rate.
According to a quote from the Press Democrat the president of DataQuick expects foreclosures to "shoot back up" over the next three months.
Data from ForeclosureRadar confirms this assertion. In just the first two weeks of July their have been 125 auction dates set for delinquent homes in Sonoma County. In all of June there were just 144.
Again, if you're in the market for a foreclosure, don't panic when your real estate agent tells you about dwindling supply. There is plenty more on the way.
Isn't there yet another moratorium on foreclosures in CA? I think it started in June and ends September 1st. But some of the big banks were excluded, and can move forward with foreclosures, I seem to recall...may account for the so-called "dwindling" supply of distressed homes.
ReplyDeleteHi Lisa,
ReplyDeleteThere is a new moratorium, but lenders that already have a loan modification program in place are exempt. As such all major banks should NOT be affected.
However, the big banks are STILL holding back foreclosures. Here is the LA Times on the subject:
Exempt lenders still held off on foreclosure filings. Bank of America, for instance, filed 48% fewer notices of trustee sale in June than in May. O'Toole called such declines "an outcome we are struggling to find an explanation for." Its unclear whether lenders simply are overwhelmed by the volume of foreclosures or if there is an effort to slow foreclosures to ease the flood of repossessed properties hitting the market.
http://latimesblogs.latimes.com/laland/2009/07/banks-moving-slowly-on-foreclosures.html