Archive for 'California'

The three-month delinquency rate on homeowner association dues in 260 homeowner associations run by Merit Property Management in California has increased to 5.3 percent in March from the 2.8-percent delinquency rate in June 2008. The rate could be a precursor of another wave of foreclosed homes in the state.

In the first quarter, California had 230,915 foreclosure filings, 45,784 of which are real estate owned homes, based on a report from RealtyTrac.

According to Merit Property, HOA delinquencies began to rise in December 2007, when it increased significantly from only 0.8 percent in March of the same year.

The delinquency rate for HOA dues is significant because it is a concrete indication of financial hardship for homeowners, since homeowners default on their HOA dues first before defaulting on their monthly mortgage payments. HOA delinquencies which are not resolved can lead to pre-foreclosure notices and ultimately to lists of foreclosed homes.

In March, notices of pre-foreclosure increased in California after the state suspended filings that could lead to more foreclosed homes during the first months of the year.

Andrew Schlegel, vice president for finance at Merit Property, said that delinquency rates have increased to 15 percent in some Merit homeowner associations. Schlegel contends that the rise in notices of pre-foreclosure and HOA delinquency rates may usher a new wave of foreclosed homes in California.

Homeowner associations, which are a group of condos, townhouses or other residential developments, operate like small municipalities. They charge HOA dues to pay for common services such as security, landscaping and other association services.

Around 60 million families reside in homeowner associations, which have already reached 300,000 in number around the country. When mortgage lenders write mortgage loans for homes in community associations, they first ask the HOA’s management company for the HOA’s delinquency rate.

For prospective home buyers, it is advisable to ask HOA delinquency rates before buying a property in community associations.

Renters of homes in community associations are also advised to check their lease contracts if they are obliged to pay HOA dues, so they can compute their total monthly rental costs.

Owners of homes in an HOA cannot exclude themselves from the community association because their homes are within the jurisdiction of the HOA and they are obliged to comply with the HOA bylaws. Refusal to pay HOA dues and comply with bylaws can lead to legal action.

Managers of HOA communities have been warning homeowners to pay their HOA dues as they modify or refinance their loans to prevent their homes from becoming foreclosed homes. They are reiterating that HOA can still pursue foreclosure proceedings if they continue to ignore their HOA dues.

A government foreclosures scheme proposed by Los Gatos-based private company EARN and nonprofit group Northern California Urban Development is being studied by the city officials of Menlo Park and East Palo Alto.

The proposed government foreclosures scheme aims to help homeowners more than 3 months behind in their mortgage payments. Program officers would negotiate with mortgage lenders to buy the delinquent mortgage at current market values, which would approximate the amount the lender would receive if it pursues a foreclosure filing. The lender is expected to agree to negotiate because it will save foreclosure costs and will free itself from time-consuming foreclosure procedures.

A portion of the mortgage, preferably 70 percent, would then be refinanced by a local community lender. The other 30 percent would be financed by the city as its cash investment in the home, allowing the homeowner to pay only the 70-percent community bank loan.

With the record low mortgage rates available these days, the borrower’s monthly payments could be reduced to half of the borrower’s original monthly payments.

The city would get back its 30-percent investment when the loan is repaid and would also get 50 percent of profits gained if home prices appreciate above current home values. If the house is lost to private lender or government foreclosures, the city could suffer a loss, since the bank which refinanced the bigger portion of the mortgage takes precedence over the city’s investment.

According to David Shapiro, chief executive of EARN Group, developer of real estate financing schemes, said major lenders have expressed support for the program. The Community Trust credit union in East Palo Alto has committed to make refinancing for Menlo Park and East Palo Alto homeowners.

Marc Prioleau, board member of the NCUD, said the proposed government foreclosures program is able to help homeowners keep their homes and prevent neighborhood blight.

Shapiro admits that the proposed government foreclosures scheme requires large cash investments, so it cannot be implemented for a large number of homeowners initially. Part of the investments could also be lost because the loan will be repaid in many years. Besides, many taxpayers do not like the idea of spending tax money for people who they see are reckless and foolish for borrowing beyond their means.

But Shapiro argues that once the program becomes successful in Menlo Park, which can afford to experiment because of its relatively big reserves, it can capture the interest of large organizations and funds like the California State Teachers’ Retirement System and the California Public Employees’ Retirement System, which had suffered financial losses due to private lender and government foreclosures.

Search California Foreclosures by City:

• Riverside Foreclosures
• San Diego Foreclosuress
• Los Angeles Foreclosures
• San Jose Foreclosures

Here is a priest who not only looks after the spiritual needs of his flock but their housing needs as well. He helps them not only to get saved from sin but also helps them save their houses from becoming foreclosed homes.

Father John Lasseigne serves as priest in an area where 1 house in every 9 housing units is hit with a foreclosure filing: the community of Pacoima in Southern California. He leads the Mary Immaculate Catholic Church.

Lasseigne said many of his flock were victims of predatory lenders. The lenders enticed them with loans that had very low monthly payments at the start, but which shot up into unaffordable monthly payments later.

The priest said he first learned about the problem of forclosed properties when a family approached him and asked him to pray for them so they would not lose their home to foreclosure.

He partnered with the community organization One LA and started conducting sessions to teach residents on how to save their houses from becoming foreclosed homes.

In a recent session held at a local school facility, local officials and mortgage lenders attended and saw hundreds of families worrying about foreclosed homes.

A family man Luis Dimas spoke and related how his monthly payments shot up from $2,800 to $4,800. He said he has been approaching his lender for months to work out a loan modification without success.

Others like Juan Jacobo, whose house is already added to inventories of foreclosed homes, and Juana Rodriguez, who is struggling with her subprime loan, also described the difficulties they are facing.

Jacobo said he is thankful that community events are held to highlight what families in the community are facing. He said lenders need to see that families are prepared to fight to save their houses from becoming foreclosed homes.

Yvonne Mariajimenez, a lawyer working with the Los Angeles County nonprofit group Neighborhood Legal Services, also spoke and cited the threat faced by the families and the low level of wages received by many of the people in the community.

Lasseigne said he has helped over 300 families connect with their lenders for loan modifications. He said his mission is to bring God’s message to the people and at the same time help them with their social needs.

The priest averred that many of the families are victims of financial entrapment. They did not fully understand the papers they signed when they got their mortgage loans. They did not know that high-risk subprime loans can lead to a nightmare of foreclosed homes.

Search California Foreclosed Homes by City:

• Los Angeles Foreclosed Homes
• San Diego Foreclosed Homes
• San Jose Foreclosed Homes
• San Francisco Foreclosed Homes

A total of 190 repo homes were sold for a total of $21 million by auctioneers Real Estate Disposition Corp. and Hudson & Marshall in Sacramento last weekend.

Irvine-based REDC sold 162 repo homes for a total of $17.1 million while Dallas-based Hudson sold 30 repo homes for a total of $4 million.

Since June 2007, REDC has already sold 1,912 repo homes located in Sacramento for a total of $261.4 million. REDC spokesperson Rick Weinberg said his firm has conducted nine auctions in Sacramento since June 2007, collecting $66.9 million in 2007 and $158.7 million last year for the mortgage lenders who repossessed the properties from homeowners who were not able to pay their mortgage loans. During the first months of 2009, the firm has already sold repo homes for a total of $35.8 million. The firm estimated that 70 percent of buyers were families that plan to occupy the homes and that 30 percent were investors.

Hudson & Marshall has held 8 auctions in Sacramento since the nationwide foreclosure problem started, selling 200 repo homes in 2008. Hudson spokesperson Crystal Wright said Hudson has sold a total of 1,000 repo homes located in Northern California in 2008. The Sacramento auction was one of 8 foreclosure auctions held by Hudson across Northern California that collected $42.5 million for mortgage lenders who owned the repo homes.

Weinberg related that REDC has sold over 6,500 repo homes in Northern California since the wave of forclosure homes began in 2007. He said the defaults were driven by subprime and other high-risk lending and rising unemployment rates.

Based on research from MDA DataQuick, the counties in Northern California with the highest number of repo homes are El Dorado, Amador, Nevada, Sacramento, Placer, Yolo, Sutter and Yuba. MDA said it expects to release a report showing increases in notices of default, which are given by mortgage lenders when homeowners fail to pay several monthly amortizations.

REDC spokesperson Weinberg also cited the large declines in home prices in the auctions held by REDC. In June 2007, REDC sold 107 repo homes for a total of $26.5 million, averaging almost $248,000 for each house sold. Last weekend, the 162 repo homes sold averaged only about $106,000.

Dave Webb, founder of Hudson & Marshall, affirmed the large declines in home values. He said last weekend’s auction averaged only about $133,000 for each house sold.

Home sales and condominiums from foreclosure listings dominated Southern California real estate sales in March, based on a report from MDA DataQuick. Total housing sales in March increased by 52 percent from March 2008 sales, as the continued growth of foreclosure listings pushed down home prices by over 33 percent.

Los Angeles, San Diego, Riverside, San Bernardino, Ventura and Orange contributed increased sales of new and existing homes to push total sales in March to 19,486, increasing by nearly 7,000 the total sales of 12,808 in March 2008.

With median home prices falling by 35 percent to $250,000 compared to March 2008 levels, 55 percent of total sales of existing or pre-owned condos and homes were from foreclosure listings.

The counties of Riverside and San Bernardino accounted for much of the sale of foreclosure properties, increasing sales by 64 percent and 89 percent respectively, because home prices declined more steeply in these counties than in any other county.

Meanwhile, FHA-insured mortgages also increased by 10 percent compared to March 2008, since most first-time homebuyers preferred FHA, accounting for 38 percent of total mortgage loans taken during the month.

Throughout Southern California, sales of new homes and properties from foreclosure listings rose for the 9th straight month. Sales in Orange County sales increased by 45 percent, San Diego County by 43 percent, Ventura County by 40 percent and Los Angeles County by 40 percent.

In the middle of 2007, media home prices across Southern California reached its peak of $505,000. In March, because of continued addition of homes to foreclosure listings and the continued rise of total California foreclosures, this high price figure fell by 43 percent in San Bernardino to $150,000; by 39 percent in Riverside to $187,000; by 28 percent in San Diego to $285,000; by 32 percent in Los Angeles to $300,000; by 24 percent in Ventura to $326,000; and by 23 percent in Orange to $390,000. All these figures were based on the report compiled by MDA DataQuick.

MDA DataQuick, led by its president John Walsh, is run by MacDonald, Dettwiler and Associates. It gathers real estate data from county records and provides its data to lenders, title companies and government agencies.

Borrowers in Southern California have become smarter and more realistic in the face of the economic downturn. Aside from buying lower-priced homes from foreclosure listings, they also chose mortgages that limited their monthly payments to only about $1,074, much lower than the typical monthly payment of $1,841 in March 2007.

A 16,000-square-foot luxurious mansion in San Diego was reported to San Diego County Sheriff’s Department on March 26 for having been stripped of about $1 million dollar worth of expensive appliances, antiques, fixtures and equipment.

The mansion, which has followed the fate of many foreclosed homes in California, was supposed to be a drug rehab center operated by alternative medicine doctor Deepak Chopra, electrical engineer Suzy Brown and 60 other investors.

When Brown was getting a building permit for the center, neighbors protested and sued against the proposed construction. Brown however won the case and went on to build the center, but before the center could operate, Chopra backed out of the endeavor, drying up funds and hastening the foreclosure of the building. Brown moved out on March 22, just four days before mortgage lender Chevy Chase Bank reported the theft to the police.

Neighbors are asking how the thieves could have stolen large pieces of personal properties without being seen. Resident John Schumate said dogs in the neighborhood would have barked wildly if strangers were loitering in the area. This question probably led other neighbors to contend that Brown herself removed the expensive belongings from the mansion when she moved out.

The mansion, which is now just one of thousands of housing foreclosure in California, was once among the most spectacular mansions in the city of San Diego. It had 15 luxurious bedrooms and 17 large bathrooms and had even acquired a name–Vivienda.

Steven Ashkar, a San Diego County detective, said the investigation for the high-end theft has been assigned to him. Some even made a joke about Ashkar’s job of looking for missing toilets.

Even so, the toilets are worth thousand dollars as the toilets contributed to the high estimate of the theft, which was initially pegged at $250,000, well over the price of most foreclosed houses. But the estimate was later increased to about $1 million, as more equipment, appliances and fixtures were found to be missing.

Foreclosed homes have been the target of vandals and thieves across the country, as distressed homeowners abandon them. Some homeowners also vandalize their foreclosed homes in their anger and bitterness.

Suzy Brown is hurt that neighbors branded her as having orchestrated the theft. She said all she cared about was for the property to be preserved in its original condition.

Indeed, the once-splendid mansion is now just one of many foreclosed homes in San Diego, but its fall is still the top topic in the community.

U.S. Housing and Urban Development Secretary Shaun Donovan was accompanied by California Congresswoman Maxine Waters when he went to Los Angeles to take a look at some of the city’s housing foreclosures.

Los Angeles contributed thousands of foreclosed homes to total California foreclosures, making California one of the nation’s top three states in foreclosure rates in 2008 and in the first two months of 2009.

Donovan visited Los Angeles primarily to evaluate the impact of foreclosed homes on neighborhoods and to look at some of the foreclosed homes that will be purchased and rehabilitated by the city government under the Neighborhood Stabilization Program.

In 2008, Congresswoman Waters, head of the Housing and Community Opportunity Subcommittee, led congressional efforts to create NSP, which was later approved and funded under the Housing and Economic Recovery Act of 2008. NSP was funded with nearly $4 billion, specifically to aid efforts by states, cities and counties to rehabilitate neighborhoods battered by foreclosed homes.

Again in 2009, Waters campaigned and got support for her proposal to add another $2 billion funding for NSP through an inclusion in the American Recovery and Reinvestment Act, which was made into law in February.

From the first NSP allocations, the state of California and its local governments received $530 million, with almost $33 million for Los Angeles and almost $17 million for Los Angeles County.

For the second round of funding, HUD will be accepting funding applications from state governments, local governments and nonprofits in May.

One of the foreclosed homes on East 90th Street became imprinted in pictures when it became the location of a news conference held by the group of HUD Secretary Donovan, Congressman Waters and Los Angeles Mayor Antonio Villaraigosa. The foreclosure property, a single-family home, illustrated the kind of foreclosed homes that the city will buy, repair and resell or rent out.

The city government has hired Restore Neighborhoods, a community-based development enterprise, to find, buy and repair foreclosed homes that later will be sold or rented out to moderate-income families that will occupy the restored homes and not to investors who would just resell them with high margins.

In her speech, Congressman Waters thanked HUD Secretary Donovan for his efforts in helping Los Angeles, which holds about one-fourth of all California foreclosures. She also cited the partnerships created by Obama’s administration, Congress and local governments in solving the problem of foreclosed homes.

Search Foreclosures by City:

• Miami Foreclosures
• Brooklyn Foreclosures
• Houston Foreclosures
• Chicago Foreclosures

Led by Father John Lasseigne of the Mary Immaculate Church and other community leaders, residents of Pacoima and San Fernando Valley are hopeful that their battle against Los Angeles foreclosures will end positively.

The effort has spurred over 500 Latino immigrant families facing foreclosure to bargain with banks, a unique attempt at collective negotiation and information exchange according to housing experts.

Lasseigne’s congregation is a member of One-LA, affiliated with the left-leaning Industrial Areas Foundation. The group intends to record when and how lenders agree to a loan adjustment, information which they would pass on to government officials who they hope would help them stop Los Angeles foreclosures. The group also hopes to inspire other communities, and be heard by their elected officials, if not their lenders.

Indeed, policy experts and government officials have been watching the move with interest, especially since financial leaders have criticized the private sector of doing enough to help with the foreclosure problem. Rep. Brad Sherman said, in a written statement, that foreclosures affected both homeowners and communities. City Councilman Richard Alarcon said that many vacant homes have become wastelands or rave party sites.

There are those though who are skeptical of the group’s actions. Chase Bank, which met with around 60 homeowners last Sunday at a Pacoima law office says that the loans were not made as a group, thus the mortgage was a home-by-home issue.

However, residents feel that they have no other choice. The Valley has over 8,000 homes in default or in stages of foreclosure. Mortgage adjustment is tricky since home values have plunged as many borrowers have bad credit and low-paying jobs. Even modified loans at fixed rates may be unaffordable for most families.

Some residents have been pushed to bad loans by unscrupulous brokers. Others suffered illness or have lost their jobs. Whatever reason they have for not paying the mortgage, the group is serious in continuing the fight to prevent more foreclosures from taking away their homes.

Find information about government foreclosures.

The foreclosure crisis continues its journey within the whole nation, and one great problem associated with this is the growing number of foreclosed homes that are being destroyed as it waits for its next occupants.

Most realtors are troubled by the unsavory folks who break in foreclosed homes, leaving graffiti, garbage, broken glass windows, and other damages. Thousands of homes have been ruined this way throughout Central Valley in California.

It is a scary job for realtors to encounter such trouble as they visit foreclosed homes. This is why most of them have applied for concealed weapons permit to keep themselves safe. Their own safety is not just their concern, but the protection of the properties they handle as well.

For security purposes, some banks now switch to solid metal security from plywood patch jobs they usually do before. There is this company that a bank has hired to secure the foreclosed home with thick metal. It has created the first steel-protected home, which is in Merced County. This keeps burglars at bay, but hopefully it does not scare away potential buyers.

One national sales manager on vacant property security has said that their company is working on a label that gives more aesthetics to the metal doors and windows. However, everyone agrees that it already looks better plus it prevents greater damages left by those who break in. Yes it may somehow look like prison but it is pretty good.

According to the authorities, another way to maintain the safety of communities is for neighbors to report any suspicious activity they observe in foreclosed homes within their areas. The security of unoccupied houses is of great importance.

What will save California foreclosures from ruins is not just all the banks efforts but the combined efforts of the realtors and neighbors in protecting the foreclosed homes within their communities.

Search for Foreclosures for Sale by California Top Cities:

• Los Angeles Foreclosures
• San Diego Foreclosures
• San Jose Foreclosures
• Sacramento Foreclosures

As California foreclosures continue to rise, the inventory of unsold foreclosed homes has increased to more than 5,000 units as of October 20.

Nevertheless, the sales rate for repossessed houses in the state has jumped much higher compared to 2007. Of the entire 23, 572 houses foreclosed by mortgage banks in the Sacramento region since 2006, a total of 18,491 have been sold. Real estate research firm MDA DataQuick also said that the sales rate for foreclosed homes has surpassed the sales rate for new homes.

The soaring number of repossessed homes is not decreasing however. California foreclosure rates continue to rise. In the Sacramento region, mortgage lenders foreclosed 7,277 homes during the quarter ended September 30, up by 32 percent from the second quarter.

What has been bothering sellers most is the rapid fall of home prices due to the foreclosures. According to real estate research firm First American CoreLogic, in one section of Rancho Cordova, 84 percent of households with mortgage loans have negative equity, collectively owing the banks $120 million more as of October because of the depressed values.

The depressed prices have made foreclosed homes the top sellers in the Sacramento real estate market, which covers four counties. Sales of bank-foreclosed homes consisted of 66 percent of total real estate sales volume in October, even though they made up only about one-fourth of the total inventory of real estate properties for sale.

According to real estate analyst Trendgraphix Inc., as sales of bank-foreclosed houses have been steadily rising, the sales of non-foreclosed homes have been flat in all the four counties.

In contrast to the selling frenzy, there is one national bank which has chosen to rent out some of its foreclosure properties rather than offer them for sale. Robert Machado, president of HomePointe Property Management in Sacramento, confirmed that his firm has signed a contract with the bank, which did not want its name known, to rent out some of its foreclosed homes.

Search Foreclosed Homes in California Top Cities:

• Los Angeles Foreclosed Homes
• Sacaramento Foreclosed Homes
• San Diego Foreclosed Homes