ForeclosureS.com: 364,000 Homeowners Face Foreclosure So Far This Year

SACRAMENTO –The worst of the U.S. housing slump may be over but not the foreclosure nightmare that haunts many of the nation’s homeowners.

More than a quarter-million (253,803) pre-foreclosures and notices of pending foreclosure auctions were filed nationwide in the first quarter of the year. That means 2.4 out of every 1,000 homeowners faced losing their property to foreclosure in the first three months of 2007, according to new and expanded foreclosure filing numbers now available from ForeclosureS.com, a California-based real estate investment advisory firm and publisher of foreclosure and property information.

Those numbers are up 22.5 percent from the 207,128 filings in the fourth quarter 2006. They also don’t include tens of thousands more now-vacant properties that actually were lost to foreclosure during that same period. Those REO or bank-owned real estate filings totaled 110,791 in the first quarter alone, reports ForeclosureS.com, which has been analyzing housing markets since 1992.

“The numbers cast a dark cloud over the American Dream of homeownership,” says Alexis McGee, president of ForeclosureS.com and author of the upcoming book, “The Foreclosures.com Guide to Investing: Making Huge Profits Investing in Pre-Foreclosures Without Selling Your Soul” (John Wiley, September 2007). “Unfortunately for those overextended homeowners it’s a cloud that isn’t likely to lift any time soon either, especially in light of the recent troubles in the sub-prime lending market,” McGee adds.

 In the past weeks, some of the nation’s biggest subprime lenders have cut back or shut down their operations. New Century Financial Corp., for example, stopped taking new loan applications, then filed for Chapter 11 bankruptcy protection; mega-lender Countrywide Financial pulled out of the subprime market altogether; and another big player, Fremont General Corp., after watching its stock plummet, is selling off its subprime lending unit. The end result is that financially strapped homeowners now have even fewer bailout options.

“Remember, a lot of these foreclosures, auctions, and REOs are in part a result of homebuyers who really couldn’t afford to purchase their homes, but did so anyway with creative financing (relaxed loan qualifications, too) and the expectation of rapidly rising home prices,” says McGee. “Now, those low monthly mortgage payments have adjusted upward beyond reach, housing price appreciation has stagnated or dropped, and in many cases their lender is gone. Though the remaining lenders hope to help their homeowners work out their mortgage woes, the plain fact is that the financial markets are now using tighter underwriting guidelines then they were just a few months ago. Homeowners who can’t afford their monthly payments, rather than simply refinance their way out of trouble as many have grown accustomed to, will now have to sell their homes quickly, or risk losing their home to foreclosure. That means in the coming months we can expect to see many more pre-foreclosure filings, more auctions, and more REOs,” adds McGee.

Meanwhile, earlier this month in Detroit Michigan a group of lenders, with REO portfolios bulging and area prices depressed, hired Texas-based auction experts Hudson and Marshall to auction 450 REO properties. Initial bids were set at $1, with only a $3000 deposit required to bid. Some run down properties in the poor neighborhoods sold for less than a car -- $30,000 or less!

 “But don’t expect to pick up a great deal on a great house in a great location at an REO auction,” adds McGee. “The well-publicized Detroit auction drew a huge audience of bidders, and subsequent competitive bidding led many properties to sell at or above market value.”

Let’s look closer at some numbers from ForeclosureS.com’s expanded database of more than 2 million listings:

·                         Nationwide, auction filings alone for the first quarter were up almost 50 percent from the previous quarter--102,930 vs. 69,802 for fourth-quarter 2006.

·                         Pre-foreclosure numbers climbed, too—168,837 in first-quarter 2007 vs. 138,799 in fourth-quarter 2006.

·                         Total March foreclosure filings in all three categories—pre-foreclosures, auctions, REOS—also were up substantially over February numbers--70,350 pre-foreclosure filings in March, up 39 percent over the 50,496 in February; 45,512 auction filings, up 52 percent over the 29,867 in February, and 45,561 REOs in March, up 50 percent over the 30,337 in February.

·                         California led the nation in pre-foreclosure filings (49,016 year to date) and auctions (25,023 year to date); both numbers are up substantially from the same time last year, 139% and 277% respectively.

·                         Texas had the most REO or bank-owned real estate filings with 14,101 year to date, up from 11,226 a year ago.

·                         On a per capita basis: Ohio led in REO filings with 2.5 per 1,000 households (11,027 filings year to date) with Tennessee a close second—2.2 per 1,000 (5,022 filings).

·                         Colorado led in pre-foreclosure filings with 5.9 per 1,000 households (9,711 filings) with Florida a very close second with 5.8 foreclosures per 1,000 households (36,598 filings).

·                         The Top Five Counties in terms of numbers of pre-foreclosures included:

o       Los Angeles, California: 9,354 filings year to date up 92 percent over 4,871 for the same period a year ago.

o       Clark, Nevada: 6,601 filings, up 143 percent from 2,720 a year earlier.

o       Cook, Illinois: 6,259 filings, up 44 percent from 4,363 a year ago.

o       Miami-Dade, Florida: 6,197 filings, up 90 percent over the 3,262 a year earlier.

o       Riverside, California: 6,103 filings, up 172 percent from 2,247 filings for the same time a year earlier.

·                         The Top Five Counties in numbers of auction filings included:

o       Dallas, Texas: 5,090 filings year to date (0.63 percent per capita), up 24 percent from 4,107 the same period a year earlier.

o       Maricopa, Arizona: 4,872 filings, up 109 percent from 2,332 the same time last year.

o       Los Angeles, California: 4,739 filings, up 222 percent from 1,470 a year ago.

o       Tarrant, Texas: 3,498 filings (0.66 percent per capita), up 16 percent from 3,027 a year earlier. Riverside, California: 3,249 filings (0.64 percent per capita), up 364 percent from 700 a year earlier.

·                         The Top Five Counties in numbers of REOs/bank-owned properties:

o       Harris, Texas: 3,985 year to date in 2007, up 147 percent from 1,616 a year earlier.

o       Wayne, Michigan: 3,701 filings, up 18 percent from 3,135 a year earlier.

o       Cook, Illinois: 2,564 filings, up 20 percent from 2,138 a year earlier.

o       Cuyahoga, Ohio: 2,322 filings, up 63 percent from 1,424 a year earlier.

o       Tarrant, Texas: 1,852 filings, up 19 percent from 1,562 a year earlier.

(To find out more about what’s really going on with housing markets and foreclosures in your area please visit http://www.ForeclosureS.com/www/pages/pressinquiry.asp and check out its new and expanded foreclosure filing statistics for media use only. You can customize your search and analysis with just a mouse click.)

MORE FORECLOSURE FILINGS BY REGION:

Southwest Region

(Includes Arizona, California, Colorado, Nevada, New Mexico, Oklahoma, Oregon, Texas, Washington)

The nation’s Southwest region continues to lead the nation in pre-foreclosure and auction filings. In the first three months of 2007, 130,392 homeowners faced the prospect of losing their properties to foreclosure. A total 44,163 properties ended up as REO or bank-owned properties, too, according to new numbers and analysis from ForeclosureS.com’s expanded database that includes more than 2 million property listings.

Looking closer at those numbers, the region had 70,073 pre-foreclosure filings, up 98 percent from just 35,487 for the same period a year ago. That means more than 70,000 homeowners faced mortgages in default. Notice of auction filings soared in the quarter too, to 60,319, up 83 percent from 32,937 a year ago.

Adding to the dismal statistics, the region includes 17 of the Top 20 counties in the nation in numbers of notice of auction filings and 14 of the Top 20 counties in numbers of pre-foreclosure filings.

Consider a few more regional numbers:

·                         Nevada leads the nation in pre-foreclosure filings per capita—10 for every 1,000 households in the state. Colorado takes the second spot with 5.9 for every 1,000 households, and California comes in No. 4 (after Florida) with 4.3 per 1,000 households.

·                         California leads the nation and the region in numbers of pre-foreclosures for the quarter (49,016 filings, up 30 percent from 37,605 fourth-quarter 2006) and auction filings (25,023 filings, up 66 percent from 15,036 the same time a year earlier).

·                         Texas leads the nation and the region in numbers of bank-owned, REO filings for the quarter (14,101, down 13 percent from 16,155 a quarter earlier.)

·                         The region’s counties hit hardest by foreclosures include: in Texas--Dallas, Tarrant, Collin, Travis, and Denton; in California—Riverside, San Bernardino, Los Angeles, San Diego, San Joaquin, Orange, Sacramento, and Contra Costa; Clark, Nevada, and Maricopa, Arizona.

Midwest Region

(Includes Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin)

Impending foreclosure hit home hard in the Midwest during the first quarter of 2007. A total 31,641 pre-foreclosures and notice of auction were filed in the first three months of the year. A total 36,021 properties also ended up as REO—reverted back to the lenders, according to new, in-depth analysis of statistics from ForeclosureS.com.

Illinois ranked fourth in the nation and tops in the region in pre-foreclosure filings with 12,061. On a positive note, that’s down 6 percent from the 12,768 in the previous quarter. However, on a month-to-month basis, March’s 4,907 filings were up 50 percent from February’s 3,263.

 Reeling from the effects of the region’s economic woes, Michigan ranked No. 3 nationally with 11,401 REO filings, and Ohio at No. 4 with 11,027 filings. But those first-quarter numbers for Michigan represent a 14 percent drop from the fourth quarter 2006, and for Ohio, an 8 percent decline.

“Despite the drop, both states likely will feel housing economics fallout from major auto industry and manufacturing cuts for a long time to come,” says McGee.

Looking at more regional statistics:

·                         Nine of the region’s 11 states actually saw a drop REO filings in the first quarter, with Indiana (2,800 filings) and Kansas (379 filings) registering significant drops—42 percent and 54 percent respectively.

·                         Pre-foreclosure numbers dropped 67 percent each in Indiana and Kansas, in the first quarter compared with fourth-quarter 2006. Unfortunately, Missouri, also hit by manufacturing cuts and job losses and the resulting economic fallout, didn’t fare as well with 3,298 filings, up a whopping 377 percent over the last quarter’s 692 filings.

·                         Ohioans continue to struggle with housing affordability issues. More than 1,376 notices of pending foreclosure auction were filed in the first quarter, up 100 percent from the previous quarter.

·                         On the positive side, in addition to Illinois, four other states in the region saw a drop in pre-foreclosure filings, including Indiana, Nebraska, North Dakota, and Wisconsin.

Southeast Region

(Includes Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, West Virginia)

Florida far outpaces the rest of the Southeast in the number of homeowners facing pending foreclosure. A total 46,023 pre-foreclosure and auction notices were filed in Florida during first quarter 2007. That’s up 26 percent from just 38,512 filings in the last quarter of 2006, and accounts for more than two-thirds of the region’s total 68,161 homeowners in financial trouble so far this year.

On a per capita basis, 5.8 out of every 1,000 Florida property owners were in pre-foreclosure, and at risk of losing their homes so far this year. In the majority of other states in the region—West Virginia, South Carolina, North Carolina, Mississippi, Alabama, Arkansas, and Kentucky, per capita numbers are negligible.

In terms of bank-owned or REO properties, Georgia barely trails Florida in the numbers, 5,555 vs. 5,699 at the end of the first quarter.

 Georgia’s problem counties continue to be in the Atlanta metropolitan area, and include Fulton, DeKalb, and Gwinnett, though two of the three saw double-digit drops in their numbers during the quarter.

Looking closer at more regional numbers:

·                         Tennessee’s pre-foreclosure filings climbed 40 percent to 4,545 in the first quarter, up from 3,239 in the final quarter of 2006.

·                         North Carolina REO filings dropped 10 percent for the first quarter to 3,877, from 4,320 the previous quarter.

·                         Month-to-month pre-foreclosure filings in North Carolina, however, climbed 27 percent to 2,516 in March, from 1,988 in February (full year-to-date data is not yet available)

·                         Six Florida counties made the list of the Top 20 counties nationwide with the most pre-foreclosure filings year to date 2007. They include: Miami-Dade, Florida (6,197 filings, up 90 percent from 3,262 for the same time last year); Broward (4,454 filings, up 62 percent from 2,750 a year ago; Palm Beach (3,439 filings, up 38 percent from 2,499 a year ago; Hillsborough (Tampa; 2,272 filings, up 90 percent from 1,195 a year ago); Pinellas (Clearwater/St. Petersburg; 1,696, up 92 percent from 883 a year ago), and Orange (Orlando; 1,599, up 62 percent from 987 a year ago.

Northeast Region

(Includes Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont)

The nation’s Northeast Region appears to be weathering the foreclosure storm better than much of the rest of the nation. Despite its major population centers, the Northeast trails in numbers of foreclosure auction and bank-owned real estate or REO filings. Only the Midwest trails it in fewest numbers of pre-foreclosure filings.

“The Northeast, with its many diversified economies, broadly diversified, didn’t have quite the mega-price appreciation or creative-financing frenzy of some other parts of the country,” says McGee. “As a result, the region is recovering faster from the housing market slump and foreclosure fallout.”

Pre-foreclosure filings in the region are up just 8 percent for the quarter--25,919 vs. 23,939 for fourth-quarter 2006. Auction filings, however, climbed 167 percent region-wide to 9,529 year to date vs. 3,571 in fourth-quarter 2006. That means a total 35,448 property owners worried about losing their homes to foreclosure in the first three months of the year, according to numbers from ForeclosureS.com.

But those numbers remain manageable compared with the bigger numbers elsewhere in the country. Looking closer at a few more regional numbers, according to ForeclosureS.com:

·                         Monroe County, Pennsylvania, had the highest number of REOs per capita in the region, 2.5 out of every 1,000 households. The county is in the eastern part of the state and its economy banks big on tourism and home construction.

·                         New Jersey had the most pre-foreclosure filings—7,821 in the first quarter, down 9 percent from 8,595 in the previous quarter. New York numbers were down, too--6,696 off 13 percent.

·                         Massachusetts led the region in notice of auction filings with 2,510 in the first quarter, up 60 percent from the 1,569 in the last quarter of 2006. New Jersey followed with just 1,256 and New York with 1,155.

·                         Pennsylvania led the region in REOs with 2,031 for the first quarter, off 43 percent from the previous quarter. Numbers dropped in New Jersey, New York, Maryland, the District of Columbia, and Massachusetts, too.

About ForeclosureS.com: Finally there’s a solid information source that provides an accurate picture of exactly what’s happening in the nation’s housing and foreclosure markets, and not just lump-sum numbers that can sensationalize the data. Sacramento-basedForeclosureS.com, publisher of foreclosure property information for more than two decades, has more than 2 million listings of current foreclosure filings covering more than 1,340 major U.S. counties. Statistics, per capita data, and analysis is available by region, state and county and by foreclosure notice type (pre-foreclosures, auctions and REOs) exclusively for the media. Get the details for your market area by visiting http://www.foreclosures.com/www/pages/pressinquiry.asp.