Based on my san diego real estate practice in which I do short sales, deeds in lieu and walk away plans, the situation is gettting worse and not anywhere near the bottom.
Many upside down home owners have been attempting to short sales only to find out that the holders of second loans are not cooperating in the short sale process. They are quite concerned when they find out the seconds can come after them for the deficiecy (if the loan was refinanced.)
Bank of America is suggesting borrowers must sign notes for 85 to 100 percent of the loan balance. Other lenders are holding out for money even though the borrowers have non recourse loans.
CNN Money || Foreclosure filings hit record in April
Many upside down home owners have been attempting to short sales only to find out that the holders of second loans are not cooperating in the short sale process. They are quite concerned when they find out the seconds can come after them for the deficiecy (if the loan was refinanced.)
Bank of America is suggesting borrowers must sign notes for 85 to 100 percent of the loan balance. Other lenders are holding out for money even though the borrowers have non recourse loans.
CNN Money || Foreclosure filings hit record in April
May 14 2008: 08:08 AM EDT
NEW YORK (CNNMoney.com)
U.S. foreclosure filings reached a record high in April, rising almost 65% over the previous year and putting municipalities at risk by cutting into the value of taxed property, according to a study released Wednesday.
Some 243,353 households, nearly one in 519, received a foreclosure filing during April, according to the U.S. Foreclosure Market Report from RealtyTrac, an online marketplace that tracks foreclosed properties. That was up 4% from March, and surpassed the record of 239,851 set in August 2007.
It's "the highest monthly total we've seen since we began issuing the report in January 2005," said chief executive James J. Saccacio in a statement.
RealtyTrac's measure of foreclosure filings includes notices of default, auction sales and bank repossessions. According to the report, 54,574 were fully repossessed by banks in April.
Property tax plunge: The record number of foreclosures added their weight to an already saturated real estate market, pulling down home prices. Plunging home values reduce the money that cities, villages and towns collect in property taxes.
In particular jeopardy are parts of Nevada, California, Arizona and Florida, whose states maintained the highest foreclosure rates, according to RealtyTrac.
"For example, the city council in Vallejo, Calif. - part of a metropolitan area with a foreclosure rate that ranked sixth highest in the nation in April - last week voted to have the city file for bankruptcy," said Saccacio.
The state of California had the second-highest foreclosure rate in the nation, up 112% over the previous year and affecting about one in 204 households. The top spot among states was held by Nevada, which maintained a foreclosure rate 3.6 times the national average, affecting about one in 146 homes.
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