Repossessed homes for sale in Palm Beach, Florida are still surging as foreclosure filings continue to rise in the area, according to a real estate information provider.

In February this year, about 4,490 households in Palm Beach County received default notices and foreclosure deeds, marking a jump of 63 percent from the previous month and an increase of 68 percent from February 2009.

In nearby Martin County, foreclosure activity also stepped up, posting a 52-percent increase from January and a 13-percent jump from February 2009. In Saint Lucie County, foreclosure postings rose by 69 percent month-over-month and climbed up by 39 percent year-over-year.

Across Florida, foreclosure activity stepped up by 15 percent, while across the country, foreclosures slowed down by 2 percent.

Bill Davis, mortgage banker who heads Private Funding Specialists, said that the still rising unemployment rate and the still declining home values have been forcing homeowners into default and foreclosure.

After a time of holding on to their homes, homeowners got exhausted, and with their savings also wiped out, they gave up.

Davis contended that the surge in repossessed homes for sale was a result of one or a combination of three causes: more borrowers deliberately defaulted, lenders pursued and completed more foreclosures, or courts were able to move more of their foreclosure backlog.

For Myles Minns and other real estate investors, the increase in foreclosures also meant an increase in earning opportunities for them. Minns has been buying and reselling five properties a week, with some of them fixed and rented out.

In Florida, the judicial system for foreclosures is another factor for the unpredictable flow of foreclosures into the market. With all courts overwhelmed with foreclosure cases, many properties are in uncertain situations, holding up the foreclosure process and preventing these assets from getting sold and used.

When these properties are finally foreclosed upon, oftentimes they are released to the market at one time, driving prices further down. In Palm Beach County, prices of homes have plunged by 43 percent from peak levels in 2005.

In one report from another real estate firm, home prices in the metro area covered by Palm Beach, Miami and Fort Lauderdale were cut down by 14.9 percent, the highest among the areas surveyed.

The firm also reported that around 45 percent of all mortgages in Palm Beach County are underwater. With these figures, the number of repossessed homes for sale is expected to rise further and home prices are expected to fall down further.

Distressed houses listings declined in Southwestern Illinois in February this year, based on foreclosure data compiled by the Illinois Association of Realtors and local realtor associations.

A total of 127 households in Saint Clair County received foreclosure notices and another 114 households in Madison County were hit with filings, slightly down from the previous month.

The two counties have been surpassing the 100-unit level every month in 2009, and the trend has not changed considerably, but local realtors are hopeful that the local foreclosure trend will follow the declining national trend.

According to the Mortgage Bankers Association, the nationwide default rate for residential mortgages fell significantly to an adjusted 9.47-percent rate in the October-December quarter, marking a drop of 17 percentage points from the default rate in the July-September quarter.

Carolyn Kemp, spokesperson for the MBA, said that the decline in the default rate was largely driven by a substantial decline in mortgages delinquent by 30 days.

Kemp also explained that the mortgage delinquency decline in the final quarter of 2009 was significant because typically, the final-quarter default rate shoots up as additional expenses during the holidays, in addition to higher heating costs, force homeowners to delay their monthly loan payments. She also said that a declining trend may be in the offing.

The MBA also reported that the number of properties entering distressed houses listings in Illinois dropped to 1.53 percent of all mortgage loans in the October-December quarter. These are properties for which the foreclosure process was started.

However, the number of delinquent mortgages has increased, with over 11 percent of all mortgage loans in default in the final quarter last year. The number of completed foreclosures also increased to five percent of all home loans in the state.

According to Mary Schaefer, communications director for the Illinois Association of Realtors, the resolution of the foreclosure crisis will depend on job creation and on the willingness of banks to refinance and make home loans. She added that unemployment have been impacting the local housing market significantly.

In Saint Clair and in Madison, home sales have been falling during the winter, with only 103 homes sold in January, according to the Realtor Association of Southwestern Illinois. The sales figure marked a 39-percent decrease from sales in December 2009.

Meanwhile, Deb Campbell, president of the Southwestern association, said that the pace of distressed houses listings will slow down further as more homeowners and buyers take advantage of federal and state programs designed to prevent foreclosure and to facilitate home ownership.

Springfield became the focus of the mortgage industry nationwide last year when Massachusetts Judge Keith Long ruled that two foreclosures in Springfield were invalid because of the defective documents submitted by the big banks that foreclosed on the properties.

In January, a total of 76 foreclosures were completed in Springfield, up by almost 77 percent from the 42 foreclosures completed in January 2009. The city followed the foreclosure trend of its county, Hampden, which posted 109 completed foreclosures, a 49.3-percent increase from 73 foreclosures in 2009.

In Hampshire County, actual foreclosures soared by 150 percent in January from 8 deeds to 20 deeds. In Franklin County, foreclosure deeds increased in number to 18, up by a whopping 350 percent from only four deeds in January last year.

Statewide, completed foreclosures also rose, although not as sharply as in the Springfield area. The total of 1,061, however, was the highest number of actual foreclosures among all January postings in Massachusetts since 2006. In January last year, the total number of bank owned home foreclosures statewide was 978.

According to Peter Gagliardi, head of HAP Housing in Springfield, more completed foreclosures are expected because mortgage lenders have been holding back over the past few months. HAP Housing, which manages the Western Massachusetts Foreclosure Prevention Center, has helped more than 2,000 distressed families since 2008.

Based on data gathered from distressed homeowners served by HAP, Gagliardi said that unemployment, and no longer subprime mortgage loans, has been pushing more homeowners to default.

The unemployment rate in December in Springfield hit 13.2 percent, the ninth highest jobless rate for any city in Massachusetts. The rate was a sharp rise from the November rate of 11.8 percent and from the December 2008 rate of 9.5 percent. The only other month that hit the 13-percent level was January 1993.

Nevertheless, according to the nonprofit Associated Industries of Massachusetts, there are some positive developments in the jobs sector in the coming months. Its monthly survey found that 25 percent of employers plan to hire workers in the next 6 months.

If the 14 percent of employers who reported they are going to cut jobs in the next 6 months pursue these layoff plans, the number of bank owned home foreclosures will certainly increase.

The number of completed foreclosures listed for the January 2010 auctions shot up by more than 4 times the number listed in January last year and almost 6 times the number in January 2008.

The number of initiated foreclosures also increased in January by more than 2 times the number in January last year and more than 3 times the number in January 2008.

Of the 12 largest Colorado counties, 8 counties posted declines in foreclosure filings compared to filings in January 2008, the month foreclosure activity started to gain ground in the state. Foreclosure activity started late in Mesa County, surging by a significant rate only in 2009. In January this year, foreclosure activity slowed in 10 of the 12 largest counties while it surged in Boulder and in Mesa.

In Mesa County, foreclosure activity surged to 145 filings in January this year, an increase from 56 filings in January last year and from 41 filings in January 2008. Total sales of foreclosure homes also increased in January this year, with 70 units sold at homes foreclosure auctions or sold back to lenders. Only 16 foreclosure homes got sold in January last year and in January 2008, only 12 units were sold.

As of February 19, lenders have already filed 106 foreclosure actions with the Mesa County Public Trustee’s Office, according to public trustee officer Sharon Ener. He added however that although more properties in Mesa County are entering foreclosure auctions over the past months, the pace of sales had not been as active.

Based on number of foreclosure filings in January, Mesa County ranked 7th among the 12 largest counties. It ranked 10th based on foreclosure sales.

Meanwhile, Mesa County real estate professionals were encouraged when total home sales in January surged by 46 percent compared to sales in January 2009. The Colorado Association of Realtors reported that 99 houses were sold in January this year, an increase from 68 houses sold in January last year.

As homes foreclosure auctions get more active with more listings, home prices continued to fall. The average sales price in January this year decreased to $192,222, compared to the average price of $206,667 in January last year.

A total of 1,917 foreclosed homes in Colorado were sold in January, an increase of over 60 percent from January last year. In contrast, foreclosure filings slowed by 3.2 percent to 2,729 filings from 2,819 filings in January last year.

Division officials said that foreclosure sales typically lag filings by 6 to 8 months. Compared to housing activity in January 2008, both sales and filings slowed down.

In Weld County, foreclosure sales involved 161 units, a 71.3-percent jump from January 2009 but a 31.2-percent drop from January 2008. Similar to the statewide trend, filings also slowed, with 213 foreclosure cases filed, a drop of almost 18 percent from January last year and 16 percent from 2008.

Larimer County also followed the state trend, posting 137 foreclosure filings, down by 10.5 percent from January 2009 but up nearly 27 percent from 2008. Sales of 98 houses repossessions were posted in January, a 53-percent jump from January 2009 but 12.5-percent down from 2008.

According to real estate analysts, in addition to sharply rising unemployment, negative equity has been a major cause in continued defaults and foreclosures across the country.

Nationwide, according to a real estate information firm, 24 percent of homeowners with mortgage loans had negative equity in the final quarter of 2009, an increase from 23 percent in the previous quarter.

In Colorado, more than 20 percent of owners of mortgaged homes had negative equity and another 8 percent nearing the underwater situation.

In the Loveland-Fort Collins metro area, almost 9 percent of homeowners with mortgage loans were underwater and another 6 percent were nearing the negative-equity situation.

In Greeley, 37 percent had negative equity and another 10.2 percent were approaching the underwater situation. To get the negative equity estimates, the research firm studied details of 47 million mortgage loans in the country, which cover over 85 percent of all home loans in the country.

In December last year, the unemployment in Colorado rose to 7.5 percent from 5.8 percent in December 2008, based on data from the Colorado Department of Labor and Employment. The number of unemployed Colorado residents increased by 14,900 to 198,400 in December.

In another foreclosure report for January this year, although foreclosure activity slowed possibly due to the post-holiday atmosphere, Colorado still posted a total of 1,782 houses repossessions during the month.

In January this year, foreclosure postings in Manatee County, Florida climbed up to 1,144, a staggering 150-percent increase from filings in January 2009. The sharp increase prompted analysts to think that the predicted wave of foreclosures this year might begin earlier.

In Sarasota County, filings jumped by 20 percent compared to a year ago to 1,219 and in Charlotte County, filings climbed up by 44 percent from January last year to 761. Both figures, however, marked a decline in filings compared to the previous month.

The three counties were among the worst performing Florida markets in terms of foreclosure rate in January, with Charlotte ranking fifth, Manatee ranking eighth and Sarasota ranking 14th among the 67 counties of Florida.

Sean Snaith, an economist at the University of Central Florida, has been predicting further increases in foreclosures over the past months because of the unemployment situation.

Another analyst pointing to unemployment as the main culprit for the surge in bank owned properties this year is Lewis Goodkin, head of Goodkin Consulting in Miami. He said that the housing market in Southwest Florida will not recover or stabilize fully until 2012 because of the challenges that must be overcome to improve the employment rate.

Statewide, total foreclosure notices in January dropped from December to 47,069, but they marked a 15-percent jump compared to January 2009 filings. Florida had almost the same foreclosure rate as California, which was one unit in every 187 residential units.

Two Florida metro areas were among the ten most foreclosure-battered areas in January. Ninth-ranking Cape Coral area posted a foreclosure pace of one unit in every 121 while tenth-ranking Orlando posted a rate of one unit out of every 143.

Real estate professional Michael Moulton, who specializes in high-end properties, said that foreclosures will increase in affluent neighborhoods. He added that he has just closed a real estate sale involving a $1.7 million repossessed home, which was listed for $3 million during the boom.

In the meantime, other resourceful and cash-rich investors are taking advantage of the rise in foreclosures. They buy bank owned properties in bulk numbers and then resell them fast at bargain prices. In Manatee, condo units purchased at bulk prices are being sold off at only $140,000 each, far below their original $435,000 price range.

While home values climbed up in other parts of the San Francisco Bay Area, house prices in Alameda County inched upward by only 0.06 percent in the final quarter of 2009 compared to the previous quarter.

Prices also remained flat in December, after they rose month-over-month in the eight months prior to November. The median sales price in the October-December quarter in Alameda was $427,484.

In Contra Costa, home prices inched upward only by 0.09 percent in the fourth quarter to $338,652. Just like in Alameda, the median price stayed flat in December last year compared to November.

The slowdown in price appreciation in the two counties alarmed housing officials who were hoping the East Bay market is already on its way to recovery. The weakening trend is especially significant because this year, the market must be strong enough to bear the impact of higher mortgage rates, the expiration of the tax credits, the end of the mortgage-backed security purchase program, the tightening of bank lending practices and the possible increase in bank owned homes.

In 2009, the San Francisco metropolitan area suffered an 18-percent jump in foreclosure filings compared to total filings in 2008. More than 54,000 houses were hit with foreclosure postings, representing 3.2 percent of all residential units in the area. The filings also marked an increase of 137 percent from filings in 2007.
In contrast to price depreciations in East Bay, areas in the San Francisco Bay where better school districts are located, prices have been climbing up due to rising demand for homes.

Based on data from Altos Research, there are around 1,900 homes available for sale in Alameda in the second week of February and there are around 2,250 units on the market in Contra Costa. Compared to the sales inventory during the same week last year, the inventory dropped by 40 percent in Alameda and fell by 48 percent in Contra Costa.

One hopeful sign that could indicate a slower increase in bank owned homes in the area in the coming months is the drop in number of underwater mortgage loans in Santa Clara, Contra Costa and Alameda, with quarter-over-quarter declines of two to 4.3 percentage points in the October-December quarter last year.

The institute said that more homeowners in the metro area defaulted on their home loans during the fourth quarter last year than in any other three-month period over the past four years.

In the last quarter, more than 24,000 homeowners were given notices of mortgage default, warning them about foreclosure if they do not make their accounts current. The figures also showed that defaults have been increasing in affluent neighborhoods.

According to Geoff Smith, senior vice president of Woodstock, foreclosures will continue this year in Chicago and in most other cities across the country because of continuing job losses and inadequacy of job creation programs.

Smith also said that the federal loan mitigation program would not be able to save homes as even reduced monthly payments would not be paid by unemployed borrowers. He added that there are also other unresolved issues such as underwater mortgages and adjustable-rate mortgages. Any recovery in the market, he said, will be wiped out as soon as the federal tax credit expires.

Woodstock data showed that pre foreclosed homes increased by the biggest rates in Lincoln Park, Near North Side and Near South Side, communities which had fewer defaults during the first year of the crisis. Previously hardest-hit communities like Hyde Park, Austin, Englewood and Auburn Gresham posted fewer defaults this year compared to 2009.

According to data from the Mortgage Bankers Association, as of October last year, nearly 10.5 percent of mortgage loans in Illinois were in default by at least 30 days but were not yet foreclosed, and another ten percent were delinquent by at least 3 months and already in foreclosure.

To step up local government efforts to fight and mitigate foreclosures, the Chicago Department of Community Development will increase its mortgage rescue events this year. The city will also continue to carry out its program of buying and fixing vacant homes with help from 43 selected developers.

Since July last year, the city has already received over $150 million to turn about 2,000 foreclosures into affordable homes.

In addition, Freddie Mac has also launched its program to cut down the number pre foreclosed homes in Chicago. It will offer assistance to distressed borrowers through the Neighborhood Housing Services and the Latin United Community Housing Association.

The trend of prioritizing credit cards was already evident in the last quarter of 2007, but it only began to be noticed widely in the first three months of 2008 when 4.3 percent of homeowners were not paying their home loans but were current on their cards. The trend got more defined when the percentage climbed up in the third quarter of the same year to 4.9 percent.

Last year, in the second quarter, the percentage shot up to 6.3 percent and then further rose in the following quarter of July to September to 6.6 percent.

On the other hand, the percentage of homeowners who were current on their mortgage payments but not on their credit card payments in the July-September quarter last year dropped to 3.6 percent, compared to the 4.1-percent level in the first months of 2008.

According to Sean Reardon, consultant in the analytics unit of TransUnion and author of the report, said that the decision of risking homes to bank foreclosures is unconventional. American consumers have always paid their secured loans first before their unsecured debts, especially when it concerned their homes.

But the hard times have screwed priorities, according to Reardon, and people who have lost their jobs cannot be blamed. Their families have to eat, so they have to guard the credit cards that could buy them some time.

Reardon studied credit-card holding homeowners with a mortgage loan and examined their mortgage and credit card delinquency data between April 2008 and September 2009.

In the July-September quarter of 2009, the default rate for homeowners with low credit scores who are current on their cards but delinquent on their home loans was 29 percent, far above the 19.1-percent posted in the last quarter of 2007.

In contrast, the percentage of low-credit consumers who have defaulted on their cards but up-to-date on their home loans dropped in the third quarter last year to 14.5 percent, compared to 18.1-percent level in the first months of 2008.

According to Ezra Becker, a top financial services executive at TransUnion, the mortgage industry meltdown that caused record bank foreclosures has redefined how homeowners are handling their finances and debt payments.

The 500-member association has been lobbying for a bill that would allow non-judicial foreclosure proceedings in Florida starting July 1 this year. Non-judicial foreclosures would allow mortgage banks to foreclose on delinquent homeowners without filing cases in court.

In effect, judges would no longer have a say on foreclosures. Lenders can immediately foreclose on borrowers in default and can force them out of their houses quickly, in as short a time as three months.

Florida, which has been known for being fierce in protecting homeowner rights, is one of several states that have been implementing judicial foreclosure for decades. California, Texas, Alabama, Georgia and 33 other states have already approved non-judicial foreclosures.

With the lobbying power and determination of the banking association, they could get their way and add thousands more to the almost 517,000 foreclosure cases already filed statewide in 2009.

As travel- and tourism-related businesses slowed down in Florida and as the unemployment rate rose over the past several months, the number of repo homes for sale also increased. In December, the unemployment rate rose to 11.8 percent, up from 11.5 percent in November. It meant that more than one million Floridians were out of work as of December, out of a 9.18-million labor force.

Based on the provisions included in the bill, non-judicial foreclosure proceedings must be completed in not less than 3 months and not more than one year. With court involvement, foreclosures can take one year or two years to get done, and longer if lawyers launch an additional legal strategy.

The bill would also effectively nullify the mandatory mediation initiative recently launched by the state Supreme Court. The bill only provides for informal talks between lenders and borrowers.

The bankers also proposed to have the right to pursue delinquent homeowners for the unpaid portion of the mortgage debt even if they have already been evicted from their homes. They nevertheless provided a waiver under which they will forgive the full amount of the loan if borrowers do not trash the properties after they are foreclosed.

According to banking association head Alex Sanchez, the bankers want to help communities manage repo homes for sale, help housing associations collect dues from delinquent properties and to help courts overwhelmed by thousands of foreclosure and bankruptcy cases.