The Foreclosure Report

A Trickle Is Becoming A Drop

A trio of foreclosure reports. "Massachusetts homeowners are falling into mortgage foreclosure at the fastest clip in 10 years, new figures show. The Mortgage Bankers Association reported yesterday that during the first quarter, roughly one Bay State homeowner in 294 entered foreclosure, the process banks use to seize properties for loan nonpayment."

"That’s double the foreclosure rate recorded less than three years ago, as well as the state’s worst showing since first-quarter 1996."

"MBA Senior Economist Mike Fratantoni attributed the problem to the state’s shrinking population, weak job growth and slowing housing market, which make properties hard to unload fast. Fratantori said Massachusetts appears to only face 'a mild slowing of the housing market.' He said the current slowdown doesn’t look like 'a repeat of the early 1990s. This is just a slowing in the housing market from the rapid growth of the past couple of years.'"

The Miami Herald. "More Floridians are falling behind on their home loans, as interest rates on adjustable mortgages rise. A faint uptick appears to be taking place, said Stuart Gitlitz, a South Florida attorney who specializes in foreclosures. 'What was a trickle is now becoming a drop,' said Gitlitz."

"One potential problem looming: The soaring popularity of adjustable rate mortgages in recent years. Other experts say the issue certainly doesn't appear to be a looming threat. 'It takes at least a year' for economic problems to manifest into foreclosure actions, said Vivian Sierra, for Miami's U.S. Century Bank. And while there is unceasing speculation about the South Florida real estate market, she doesn't see any major problems with the residential market. 'I don't see a bubble bursting.'"

"Ken Thomas, a Miami banking analyst, concurred. 'The bubble may be seeping,' Thomas said of real estate. 'But my gut feeling is that there's no evidence of major problems.'"

From a press release. "Notice of Trust Sale filings in Maricopa County, Arizona increased 19% in May and pre-foreclosure inventory crept up after 16 months of decline according to Tim Rocho, a foreclosure data provider. NOTS (notice of trust sales that starts the official foreclosure process) filings increased from 624 in April to 745 in May, the number of Auction (foreclosed) properties increased from a historic low of 35 to 55 and cancellations of pre-foreclosures decreased from 701 to 690, turning the tide of consistent declines to increase outstanding pre-foreclosures from 2243 to 2272."

"'I certainly wouldn’t call this a steep reversal in the market but it does signal that the number of foreclosures are about to increase. The weather and lifestyle continues to attract thousands of new residents every month, but with average house prices above $300,000, MLS inventory around 40,000 and interest rates topping 6.5%, the market is beginning to level off and defaults will follow,' Tim says."

From California. "With many interest-only and other 'non-traditional' mortgages set to adjust upward, some local real estate and lending professionals think the end of the year might bring some unpleasant news. In late 2006 or early 2007, many homeowners will see introductory fixed rates expire on interest-only and other types of adjustable loans they first took out over the past five years."

"The real estate market has been one of the strongest engines driving the vibrant Coachella Valley economy, though it has been softening in recent months. 'I'm not necessarily seeing a panic, but I am seeing people come in here wondering how they're going to handle those higher payments,' said (mortage broker) Patricia Chill in Palm Desert."

"'People are nervous, because some of them are in programs they shouldn't have gone into,' she added. 'Some of them are going to be paying taxes and insurance that they didn't figure into their original payments.'"

"In the Coachella Valley, in the first quarter of 2006, there were 305 notices of default issued, according to DataQuick. That was up 41 percent from the first quarter of 2005."

posted by Ben Jones @ 10:32 AM