Tag Archives: underwater

Foreclosures fall in San Diego County

Foreclosures plummet in San Diego County

“More San Diego County homeowners turned to short sales to avert foreclosure in the second quarter as the local market continued to gain momentum. Those were key factors that pushed down distress to lower-than-normal levels, based on a report from DataQuick on Monday.

The number of San Diegans who received default notices, the first step in the formal foreclosure process, fell 1.4 percent in the second quarter of this year (April to June) to 4,099 compared to the same period in 2011. This marks the lowest level of mortgage defaults seen in a single quarter in more than five years. In the first quarter of 2007 3,931 default notices were filed.

Foreclosure levels also have plunged. San Diego County recorded 1,391 in the second quarter, down 25.3 percent from the previous quarter and down nearly 50 percent from a year ago. The past quarter was the lowest one for foreclosures since the first quarter of 2007, when the county recorded 1,182 trustee deeds, which signal a foreclosure.

“Obviously the economy has been on the mend, however slowly,” said DataQuick President John Walsh. “But because housing is widely seen by economists as the biggest drag on growth, some interesting alternatives to the foreclosure process are being discussed, such as the use of eminent domain to buy and restructure mortgages. Needless to say, we’re all watching closely.”

Walsh is referring to a controversial plan from San Bernardino County and its two biggest cities — Ontario and Fontana — to seize mortgages that are underwater through eminent domain. The effort is meant to curb future foreclosures.

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More mortgage relief from the White House – but congressional ‘ok’ doubtful

Mortgage reliefAn summary update (by CAR.org) on the mortgage relief plan by the federal government, covering an article by The Mercury News:

In his State of the Union Address, President Obama laid out a plan to help responsible borrowers and support a housing market recovery. Details of that plan were released yesterday. However, funding for the proposed program must be approved by Congress, lowering the possibility that it will be implemented quickly. Making sense of the story:

  • Operated by the Federal Housing Administration, the plan would allow underwater homeowners to refinance into cheaper federally insured loans. Borrowers with good credit who are current on their loan payments are eligible.
  • The measure also streamlines the process of refinancing an underwater mortgage, eliminating the need for an appraisal or submitting a new tax return.
  • To qualify, borrowers must be current on their mortgage, have a minimum credit score of 580, and must be refinancing a loan on a single-family owner-occupied principal residence.
  • Lenders only need to confirm that the borrower is employed. Loans that are more than 140 percent of the home value probably would not qualify until banks wrote down part of the balance.
  • Congress must approve $5 billion to $10 billion in funding, leading housing experts to praise the plan’s objectives with skepticism of it passing this year.

Read the full story from The Mercury News here: “More mortgage relief from the White House – but congressional ‘ok’ doubtful.”