Foreclosed Houses Over 34 Percent of Orange, California Sales

The percentage of sales of foreclose houses in relation to total home sales in Orange County, California in May is still a commanding 34.2 percent, despite a drop in the share. In January, the percentage of foreclosed houses was 46 percent, the highest level reached in the county's home resale market. During the last months of 2008, lenders made a lot of foreclosures in Orange County, putting hundreds of foreclosed homes into the market. In August last year, over 1,400 foreclosed houses were repossessed by banks, the highest monthly total in the county's foreclosure history. Resales of foreclosed houses started to increase after August and then subsided in starting February as national and state foreclosure moratoriums were implemented to make way for the Obama administration's Making Home Affordable program. All the foreclosure homes sold in May were repossessed within the 12-month period prior to May. Some real estate market analysts contend that the declining share of foreclosed houses in home sales is due to the decision of banks to control the release of their foreclosed properties to the market in order to prevent further home price declines. Others contend that the banks are also controlling the reflection of foreclosed houses in their books to make their financial statements more attractive to investors. But banks would have to release the rest of their foreclosure inventories to the market soon because new foreclosure units are entering their books. According to county foreclosure data, banks have repossessed 591 condos and homes in Orange County in May, a rise of nearly 23 percent from April but a drop of nearly 48 percent from May 2008. California has implemented several measures to control foreclosure actions across the state, including foreclosure prevention counseling services, foreclosure moratoriums, mandatory meetings with borrowers before default notice filing and financial assistance incorporating the $8,000 federal tax credit. But many are not being helped by the federal and state programs because of various reasons such as loss of jobs, inadequate income, high levels of non-mortgage personal debts, underwater loans, ineligibility of jumbo loans and inability to trace the real holder of the mortgage loans. Nevertheless, federal and state mortgage data show that many lenders are finally working out loan modifications for qualified borrowers. The loan modification and 90-day moratorium law that became effective in June is expected to help more homeowners save their homes from becoming foreclosures houses. Start your Search for:

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