Sacramento Real Estate Repossessed Activity Goes Up

Sacramento Real Estate
Repossessed Activity Goes
Up

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Sacramento Real Estate Repossessed
Activity Goes Up
Repossessed homes in Sacramento region goes up after
dropping to a three-year low in the second quarter of 2011,
the number of Sacramento homeowners being pulled into
the foreclosure process snapped back to prior levels over
the last three months, a real estate information service
reported.


Activity Goes Up
According to a survey done by a local researcher, a little
over 1500 Notices of Default were recorded at every
Department of Real Estate (DRE) in the region during the
third quarter of the year.

That was up 25.9 percent three months prior, and down
14.4 percent during the third-quarter of 2010.


Activity Goes Up
Last quarter's Nods, which mark the first step in the
formal foreclosure process, jumped back to levels seen
earlier this year and late last year.

Lenders filed 1300 NoDs during first-quarter 2011 and 2000
in fourth-quarter 2010. NoDs peaked in first-quarter 2009
at 3500 in every DRE offices.


Activity Goes Up
According to John Walsh, a renowned figure in the real
estate industry, "Figuring out what's actually going on
when it comes to foreclosures can be a logistical
nightmare.

In each case there are at least six or seven different legal
entities contending with each other, each with a different
agenda and timeline:


Activity Goes Up
The original lender, the homeowner, the current owner or
owners of the loan, the servicing institution, the outfit
doing the actual foreclosing, and the county recorder's
office”.

He added that, "The way it looks right now, it's reasonable
to expect default filings to run at a somewhat higher level
than we saw earlier this year," he said.


Activity Goes Up
"Obviously, some lenders and loan servicers have begun
to plow through their backlogs of delinquent loans more
aggressively."

But most of the loans going into default are still from the
2005-2007 period: the median origination quarter for
defaulted loans is still third-quarter 2006.


Activity Goes Up
That has been the case for almost three years, indicating
that weak underwriting standards peaked then.

To give you an idea, the most active beneficiaries in the
formal foreclosure process last quarter in Sacramento
region were Bank of America.


Activity Goes Up
On the other hand, when it comes to primary
mortgages, Sacramento homeowners were a median eight
months behind on their payments when the lender filed
the Notice of Default. The borrowers owed a median
$19,198 on a median $331,333 mortgage.

The median amount borrowers owed at the time the NoD
was filed rose about 17 percent from the prior quarter and
27.0 percent from a year earlier.


Activity Goes Up
The gains likely stem from some lenders working faster
last quarter to get caught up on their backlogs of long-
delinquent loans.

Meanwhile, if we talk about home equity loans and lines
of credit in default, borrowers owed a median $4,576 on a
median $70,055 credit line. The amount of the credit line
that was actually in use cannot be determined from public
records.


Activity Goes Up
Keep in mind that foreclosure resales accounted for 34.2
percent of all California resale activity last quarter.

It was 35.6 percent the prior quarter, and a year ago it was
35.5 percent. It peaked at 57.8 percent in the first quarter
of 2009.


Activity Goes Up
On the other hand, short sales, (transactions where the
sale price fell short of what was owed on the property)
made up an estimated 17.8 percent of statewide resale
activity last quarter.

That was up slightly from an estimated 17.4 percent the
prior quarter and 17.3 percent a year ago.


Activity Goes Up
Two years ago, in third quarter 2009, short sales made up
an estimated 14.4 percent of resales.

Investing in repossessed homes are best when you have a
great realtor by your side in finding foreclosed homes in a
very affordable amount.


Activity Goes Up
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