After 3-Year Low, California Foreclosure Filings Rise Again

Having fallen to its lowest level in three years, California’s rate of foreclosure filings rose up to come back in line with recent rates, according to the latest information from DataQuick.

At the same time, the share of properties at foreclosure auctions purchased by investors or other non-lender, non-government entities is growing. The rate was 29.7 percent for the third quarter, up from 28.3 percent last quarter and 22.7 percent one year ago.

Foreclosure filings in the state rose 25.9 percent in the third quarter, while posting an annual decline of 14.4 percent.

In total 71,275 foreclosure filings were filed on 70,554 homes in California in the third quarter. Most foreclosures involve loans originated between 2005 and 2007, according to DataQuick.

The highest concentration of default notices took place in lower-cost neighborhoods.

ZIP codes with a median sales price of $800,000 posted a 12.1 percent rise in notices of default filings as opposed to the statewide increase of 25.9 percent.

In these ZIP codes, there were 2.8 foreclosure filings per 1,000 homes, while in ZIP codes where median sales price

stands at $200,000, there were 11 foreclosure filings per 1,000 homes.

The average homeowner who received a notice of default filing during the third quarter was eight months delinquent.

DataQuick measured the median amount a homeowner facing foreclosure owed on a median mortgage to be $19,198 on a $331,333 loan. This is a 17 percent increase from the previous quarter and a 27 percent increase from the third quarter of last year.

The counties that experienced the least amount of foreclosure filings were Marin, San Francisco, and San Mateo counties, while the counties experiencing the highest incidence of foreclosure filings were Sacramento, Madera, and Stanislaus counties

While foreclosure filings rose for the quarter, the rate of homes lost to foreclosure during the quarter declined by 8.4 percent. The total number of homes lost to foreclosure was 38,895. The is down 14.3 percent from last year.

Homes that did foreclose in the third quarter took about 9.9 months from the notice of default to the final foreclosure. This rate is almost identical to the previous quarter’s timeline of 10 months but up from last year’s 8.7 months.

Sales of foreclosed homes made up 34.2 percent of all home resales in California. This is down from 35.6 percent last quarter and 35.5 percent last year.

Short sales, on the other hand, increased from last quarter, up from 17.4 percent to 17.8 percent. The third-quarter rate is also higher than the rate recorded in the third quarter of 2010 – 17.3 percent.

“The way it looks right now, it’s reasonable to expect default filings to run at a somewhat higher level than we saw earlier this year,” said John Walsh, president of DataQuick. “Obviously, some lenders and loan servicers have begun to plow through their backlogs of delinquent loans more aggressively.”

While foreclosure filings rose for the quarter, the rate of homes lost to foreclosure during the quarter declined by 8.4 percent. The total number of homes lost to foreclosure was 38,895. The is down 14.3 percent from last year.

Homes that did foreclose in the third quarter took about 9.9 months from the notice of default to the final foreclosure. This rate is almost identical to the previous quarter’s timeline of 10 months but up from last year’s 8.7 months.

Sales of foreclosed homes made up 34.2 percent of all home resales in California. This is down from 35.6 percent last quarter and 35.5 percent last year.

Short sales, on the other hand, increased from last quarter, up from 17.4 percent to 17.8 percent. The third-quarter rate is also higher than the rate recorded in the third quarter of 2010 – 17.3 percent.

“The way it looks right now, it’s reasonable to expect default filings to run at a somewhat higher level than we saw earlier this year,” said John Walsh, president of DataQuick. “Obviously, some lenders and loan servicers have begun to plow through their backlogs of delinquent loans more aggressively.”

 WHAT DOES THIS MEAN FOR US IN THE CENTRAL VALLEY?

From where I sit is means opportunity. Today low prices combined with the low rates means both 1st time buyers and investors have the best chance ever of becoming home owners and building your retirement portfolio.

You might think real estate is a risky investment and you would be right. But the best time to buy any investment is when it is low!

A 1^st time buyer is anyone who has not owned a home in the last 3 years. This means even if you suffered through a short sale or a foreclosure and it has been 3 years (sometimes even 2 years) your financial history has been “RESET”. Don’t listen to the “Debbie Downers” of the world; you could restart home ownership right now. All you have to do is get re qualified. If you can’t buy today I can certainly give you a plan to purchase within the next 1-3 years. From what the talking heads are saying we can see low rates and low prices for at least this long.

Today is the day to make you plan. The year is coming to an end and this means, less Realtors are “working” so completion slows down for you to jump in. This is also the time of year for you to plan your goals for next year and make that tax return your down payment! It only takes 3.5% of the purchase price to get a FHA loan; you would be amazed at what you can get for $3500.00 down. Even better often then mortgage payment (with property taxes and insurance) is LOWER THAN WHAT YOU ARE PAYING IN RENT!

INVESTORS!!! Your opportunity is here too. You can build your wealth portfolio for pennies on the dollar. The difference between real estate and the stock market is when the price falls you still have the real estate and the rental income. There are new 401K accounts that are self directed and you can purchase real estate within them.

REALLY PEOPLE - EVERY BLACK CLOUD HAS A SILVER LINING

Maybe Even A Gold One!!!!