Foreclosure Wake Up Calls - Housing Tracker

Quotes of the Day

"I do have a judgment on my home and it to me is very strange because it didn't make financial sense for me to keep paying a mortgage on a home that was basically owned by someone else… Obviously, when you make all that money, people think, 'OK, let's assume it is $35 million.' People have to understand that $35 million, you're paying the government 41%. That leaves you with about $17 or $18 million, not even. Then you're taking care of your whole family." – Former baseball player Jose Canseco on why he walked away from his $2.5 million California home. (US News & World Report, May 2nd)

"We are going to call on every church, every mosque, every synagogue, every house of God.” - The Rev. Carl McCluster, asking all clergy to join Homes Saved By Faith, a new Connecticut program to help save homeowners from foreclosure. (Connecticut Post, May 6th)

Foreclosure Data

Foreclosures Double, And Home Prices Tumble. “The number of homes entering foreclosure jumped more than 100% in Q1’08 compared with Q1’07, with one in every 194 homes receiving a foreclosure filing, RealtyTrac reported. Foreclosure activity rose in 46 of the 50 states and in 90 of the 100 largest metro areas. Home prices tumbled 12.7% in February compared with last year, according to the S&P/Case-Shiller composite index of 20 cities. All but one of the 20 cities — Charlotte — saw year-over-year price drops.” (USA Today, May 6th)

Bernanke Says Traditional Lender Tactics Won't Cope With Rising Foreclosures. “Federal Reserve Chairman Ben Bernanke: Foreclosures are going to increase and more people are going to lose their homes as a result, but the causes behind the foreclosures aren't what they were in the past so lenders' traditional responses are unlikely to work. Using Fed ‘heat maps’… Bernanke showed… how wide regional variations in foreclosures suggest new and varying causes are at work. 'Increases in unemployment rates account for at least some of the recent increases in mortgage delinquencies,' he said, in parts of New England and the Great Lakes region.” (Forbes, May 6th)

Ending Housing Disparities. “According to the Center for Responsible Lending, over the next several years roughly 20,000 American families will lose homes each week.” (NY Times Letters, May 6th)

A Proposal For Curbing Foreclosures. “The Federal Deposit Insurance Corp. Home Ownership Preservation Loan plan: The Treasury Department would make loans to homeowners to pay down as much as 20% of the principal on the mortgages. Borrowers would be required to repay their restructured mortgages and the preservation loans… resulting in no cost to the government. Mortgage investors would pay the first 5 years of interest due to the Treasury on the Home Ownership Preservation Loans. After five years, borrowers would begin repaying those loans at fixed Treasury rates. The FDIC said a Treasury public debt offering of $50B would be needed to fund modifications of about 1 million loans that were "unsustainable at origination." (Detroit Free Press, May 6th)

Fast Action Needed To Curb Foreclosures. “Hard hit by 85,000 foreclosures in 2007, Ohio recruited 1,100 volunteer lawyers to help homeowners, and gave judges the authority to order mediation between borrowers and lenders… In Summit County, mediators have prevented 26 foreclosures in Q1’08 by… getting lenders to compromise on loan terms. Ohio [also] plans to create a fast track to speed the lengthy foreclosure process for investor-owned homes, which should reduce the amount of time that these properties are vacant. By contrast, the New York Legislature is considering a one-year moratorium on foreclosures, which would only add unnecessary delay to a process that already takes between 12-18 months to complete.” (Newsday, May 6th)

Aftermath Of Foreclosures. Oxnard, California Code Compliance officers now track homes that are in foreclosure… to prevent the properties, which often sit empty once banks take ownership, from falling into disrepair and becoming magnets for crime. Local housing codes give city officials broad latitude to compel owners to maintain their properties, such as issuing liens on homes to cover the cost of repairs and installing locks. The sheer volume in the number of properties now on the list makes it a challenge… Recently introduced state legislation may help by giving officials the power to levy $1,000-a-day fines to banks and mortgage companies that fail to maintain properties.” (Ventura County Star, May 6th)

Foreclosures Are Families. “Democrat Connecticut Senator Chris Dodd: Each day, there are 7,000 foreclosure filings across the country, but action to stem the tide has been ineffective. He said industry and the federal government knew last year this tidal wave was coming and, despite attempts to put programs and fixes in place, only one percent to three percent of the 1.4 million homes that have entered foreclosure have been saved.” (Connecticut Post, May 6th)

Mass. Upholds Ruling To Halt Fremont Foreclosures. “A Massachusetts court has upheld an injunction to force cash-strapped mortgage lender Fremont General Corp (FMNT.PK) to halt all foreclosures in the state to give local authorities time to review each mortgage. Fremont, formerly one of the biggest U.S. subprime-mortgage lenders, must give Massachusetts authorities at least 30 days notice of all foreclosures it intends to initiate on about 2,200 loans it still owns and services in the state… The injunction makes it harder for Fremont to unload its portfolio of subprime mortgages and loan-servicing rights on home loans in Massachusetts.” (Reuters, May 5th)

Residents Trashing Homes Before Foreclosure. “With as many as two million homeowners finding themselves entering foreclosure in 2008, some aren't leaving without taking out their anger on the home itself… A recent national survey of 1,500 real estate agents found roughly half of all foreclosures have significant damage. Realtor Anand Barnes said he see major, intentional damage in at least two out of every 10 foreclosed homes. It's such a problem nationally, lenders are increasingly authorizing "cash for keys." It has agents like Barnes pay thousands of dollars to the person being foreclosed on, to not trash the house.” (WJLA News, May 5th)

Senate Passes Bill To Defer Foreclosures, But Pawlenty And Bankers Oppose It. “A new plan to slow home foreclosures won Senate approval Monday, but its chances of moving forward face challenges from the banking industry and opposition from Gov. Tim Pawlenty… Supporters said the bill would target about 12,000 homeowners in Minnesota and establish a process allowing homeowners who hold a subprime or negative amortization mortgage to defer a pending foreclosure for up to a year. Under the proposal, homeowners would have to contact a foreclosure-prevention counselor, agree to use their services and make partial monthly payments during the deferment period.” (Star Tribune, May 5th)

The Accidental Renters. “Though hundreds of thousands of houses and condos have gone back to the banks that lent money on them, few of these properties are being offered to tenants because lenders don't want to be in the property-management business. So they sit vacant. Mark Verge, owner of WestsideRentals.com, an apartment-finding service in Santa Monica, Calif., says he's getting 7,000-8,000 inquiries a month from would-be renters, up 15% compared with last year. Many are from people who are facing or have gone through foreclosure, he says.” (Wall St. Journal, May 2nd)

Boise in Its Own Little Bubble. “The Treasure Valley Repo Bus Tour embarked on its maiden voyage in March, driving about 25 pre-qualified and hopeful homebuyers on a tour of Boise and nearby Eagle and Meridian, hunting for deals on foreclosed homes… In April, there were 200 homes in Ada County scheduled for a trustee sale, the last step in the foreclosure process, compared to 42 last April. March saw 245 defaults filed, up from 99 in March 2007. In Q4’06, single-family home permits plunged 39.6%. Idaho, as of February, ranks 20th in the nation with one foreclosure for every 774 households.” (New West, May 1st)

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