Originally published June 11 2008
California Home Foreclosures Skyrocket by Over 400 Percent
by David Gutierrez, staff writer
(NaturalNews) The number of California homes foreclosed on in the fourth quarter of 2007 was more than 400 percent higher than in the same quarter of 2006, according to DataQuick Information systems.
A total of 31,676 California homes were foreclosed in the last quarter of 2007, compared with only 6,078 in the fourth quarter of the year before. The total number of foreclosures in 2007 was 84,375, or more than six times the 2006 total of 12,672.
It was the most foreclosures since DataQuick began keeping records in 1988, and more than two times the previous high of 15,418 in the third quarter of 1996.
Mortgage default notices also hit a record, with 254,824 going out in 2007, compared with only 104,977 in 2006. The increase from the fourth quarter of 2006 to the same quarter of 2007 was 114.6 percent, from 37,994 to 81,550.
Default notices are also becoming more likely to go unheeded and turn into foreclosures. In 2006, 71 percent of homeowners were able to prevent foreclosure by catching up on their payments or refinancing or selling their homes. In 2007, only 41 percent could do so.
Falling housing prices have been blamed for the sudden jump in foreclosures.
"It's getting worse," said Andrew LePage of DataQuick. "Depreciation continues and makes it harder for more and more people when they fall behind in their payments to either sell or refinance their way out of trouble."
The situation is likely to keep getting worse, analysts say, because foreclosed homes are usually sold very cheaply, further driving down home prices and leading to still more foreclosures.
"More and more of these homes are getting dumped on the market," said Christopher Thornberg from the consulting firm Beacon Economics. "That puts more downward pressure on the market; that leads to even more people getting foreclosed on, and so on and so forth."
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