DQNews Archived Article

Foreclosures to Subside in Upcoming Months?

by Real Estate Analyst John Karevoll
April, 1996

La Jolla, CA.— While the number of California homeowners being drawn into the foreclosure process reached a new high during the first quarter of this year, there were clear indications that the foreclosure problem could subside somewhat during the upcoming months, a real estate information service reported.

A total of 44,686 homeowners received Notices of Default (NODs) during the January-to-March period (see chart). That was up 18.7 percent from 37,648 for the previous quarter and up 35.8 percent from 32,913 for first-quarter 1995, according to DataQuick Information Systems.

"NOD counts have gone up because lending institutions have become more strict during the past couple of months. We're seeing many of them take action on delinquent loans three or four months faster than they would have last fall," said Donald L. Cohn, DataQuick CEO. 48%on delinquent loans three or four months faster than they would have last fall," said Donald L. Cohn, DataQuick CEO.

A year ago most homeowners going into foreclosure were 8-10 months behind on their mortgage payments. That time span has been shortened to 5-7 months, contributing to the appearance of an increase in foreclosure activity.

"The numbers also seem to indicate that a higher portion of distressed homeowners are emerging from the foreclosure process before their homes are lost to the bank. We need another month or two of data, though, before we can call that a trend," Cohn said. While NODs were up 18.7 percent from the previous quarter, the number of completed foreclosures (Trustees Deeds) was up 7.4 percent, from 11,275 to 12,109.

The foreclosure process can take four months or more, and many homeowners either bring their mortgage payments current, deed the property to the lender, or sell their home and pay the mortgage off before the foreclosure process is completed.

DataQuick monitors real estate activity nationwide, and provides information to consumers, lending institutions, title companies and industry analysts.

San Bernardino County, which was hit hardest by the foreclosure problem on a property-by-property basis, appears to have the lowest increase in NOD counts. Portions of the Central Valley have the largest increases, although those areas had relatively low numbers a year ago.

Number of Notices of Default recorded on houses and condos January-March

County	1Q95	1Q96	% Chg.
Los Angeles	10,180	14,106	38.6 pct.
Orange County	2,864	4,486	56.6 pct.
San Diego	2,359	3,615	53.3 pct.
Riverside	3,014	3,785	25.6 pct.
San Bernardino	3,454	3,757	8.8 pct.
Ventura	579	779	34.5 pct.
So.Calif. Total	22,449	30,529	36.0 pct.
San Francisco	280	357	27.5 pct.
Alameda	1,426	1,724	21.0 pct.
Contra Costa	1,204	1,667	38.4 pct.
Santa Clara	1,111	1,274	14.6 pct.
San Mateo	452	536	18.4 pct.
Marin	136	173	27.1 pct.
Solano	422	602	42.7 pct.
Sonoma	268	394	46.8 pct.
Napa	71	102	43.8 pct.
Bay Area Total	5,370	6,828	27.2 pct.
Santa Cruz	142	202	43.0 pct.
Santa Barbara	268	349	30.5 pct.
San Luis Obispo	252	298	17.9 pct.
Monterey	150	214	43.2 pct.
Coast Total	811	1,064	31.1 pct.
Sacramento	1,398	2,099	50.1 pct.
San Joaquin	563	959	70.2 pct.
Placer	237	321	35.6 pct.
Kern	471	638	35.2 pct.
Fresno	486	720	48.2 pct.
Madera	109	133	22.0 pct.
Merced	105	148	40.4 pct.
Tulare	268	355	32.5 pct.
Yolo	105	163	55.3 pct.
El Dorado	105	177	69.3 pct.
Stanislaus	435	553	27.2 pct.
Inland Total	4,282	6,265	46.3 pct.
All California	32,913	44,686	35.8 pct.

Source: DataQuick Information Systems

For more information call John Karevoll (909)867-9534

Copyright © 1996 DataQuick Information Systems.
All rights reserved.

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