A Slight Fall Experienced in the Foreclosures of the County

The San Diego County experienced a slight fall in the foreclosures in the previous month, however, the number of defaulters are increasing and the lenders are still; struggling to help those homeowners who are unable to repay their debts. According to the MDA DataQuick report, last month itself there were at least 1,101 foreclosures.

This figure is 8% less than 2008 August and 49% less than September 2008 figure. The default notices being the first stage of foreclosure amounted to 2,726, which is 3% up since August but this figure is almost double the figure last year as default actions were delayed to some extent by the new regulations. According to the analysts this indicates that the trend of trouble and distress will continue.

John Walsh, the President of DataQuick observed that, “There’s a batch of truly nasty loans that were made in mid-2006. There’s another batch made in late 2006. These are worse than the month before and after, and it’s taking a long time to process them.”

According to Andrew LePage, an analyst in DataQuick, the focus of trouble is shifting from low-cost, subprime loans to higher-cost in the inland locations and among the coastal properties, the trend has persisted at prime loans.

For instance, in at least 6 of the ZIP code areas featuring high prices featured an increment of 36% to 140% among the notices of default as compared to the average figure in the last year. However, the number of defaults continued to remain unusual as they were 8 in Coronado, 12 in Del Mar, 21 in Hillcrest, 26 in Mission and Pacific Beach, 34 in Carmel Valley, and 39 in Encinitas.

According to the report of the Mortgage Bankers Association for August the defaults with mortgages were crossing all limits since 1972. The rate of defaults on a seasonal basis was at 9.2% by the end of the second quarter and compared to the last year’s figures this was almost up by 2.8%. Dustin Hobbs, the representative of the California Mortgage Bankers Association, observed that the lenders are not in a major rush to work on the process of foreclosure if they feel that with the present amount of incentives the loan modification can be encouraged.

However, Paul Leonard from the Center for Responsible Lending commented that the consumers have continued to complain regarding the lenders including the companies for loan servicing as they tend to take a lot of time for making decisions. They add to the problems of the consumers when they lose the paperwork and the consumers are shunned from agent to agent but they do not get any help.

Leonard stressed that, “The capacity of the servicers, both human and technological, is still limited and not sufficient to keep pace with the scope of the problems they’re dealing with.” The president of CMG Mortgage Chris George in San Ramon also being the secretary of the mortgage bankers group disagreed to the view.

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