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Declining Default Notices in California Gives Hope to Locals
By admin | June 13, 2008
Since the subprime mess started, California has recorded one of the highest foreclosures rate in the nation. With the state suffering from declining home prices and growing inventory of foreclosure homes, it is considered very rare for the industry to receive any news that will somehow provide a glimmer of hope.
But a report released by ForeclosureRadar revealed that there were fewer default notices for the month of May in California. In fact, the number of default notices declined by 2.5 percent compared to last month. These notices are usually sent by mortgage lenders to homeowners who failed to pay their monthly mortgage obligations. In other words, you can consider them as the first stage in the entire foreclosure process.
Experts are hoping that the decline will lead to fewer foreclosures in the coming months. Statewide, the number of default filings has reached an average of 2,009 per day. Such large number has definitely brought problems to the state, particularly with the housing market. Home prices have dramatically declined over the past year, mainly due to the thousands of foreclosure homes for sale in the market.
Also, the California Mortgage Bankers Association believed that the reason for the decline in default notices could be because of the concerted efforts given by lenders and non-profit organizations to help distressed homeowners stay in their homes. The most popular option that seems to be effective in stopping foreclosure is loan modification. This option allows the troubled homeowners to work with their lenders in order to make the mortgage payments more manageable.
Lenders, on the other hand, have started offering bigger discounts for the foreclosure homes that fell on their hands after failing to get sold in foreclosure auctions. Last April, these lenders offered an average of 25 percent discount from the asking prices. with foreclosed properties, the asking prices are based on the amount of the mortgage debt owed by the previous owner.
Topics: Foreclosures by State |