Foreclosures continued to ease across the country last month, but Inland Southern California is feeling the long-term damage more than any other metropolitan area.
One housing unit in every 213 in San Bernardino and Riverside counties was in some phase of the foreclosure process in April, according to a report from RealtyTrac, an online marketer of foreclosure properties. That gave the Inland area the most foreclosure activity, by a wide margin, of any of the nation?s 20 largest metropolitan areas.
Miami, with one residential property in 273 involved in the foreclosure process, was a distant second.
The number of Inland-area homes in the process has been steadily declining, and last month?s drop indicates a sharp decline from where it was 12 months ago. There were 7,049 homes somewhere in the foreclosure process last month, about 30 percent fewer than April 2011, RealtyTrac reported.
The process includes homeowners who have received default notices, the scheduling of trustee sales and repossessions.
In the two Inland counties, 1,459 homes were taken over by banks or other lenders last month, with more than 60 percent of them in Riverside County, which has more houses than San Bernardino County.
Foreclosures have not been recorded in numbers as large as were seen in 2010 and 2011 because of the settlement large banks reached earlier this year with the federal and state governments on how they used to be processed, but that is expected to change in the next few months, said Steve Johnson, director of the Riverside office of MetroStudy, a real estate consulting firm.
?A lot of inventory will be coming back into the foreclosure process,? Johnson said. ?These institutions are doing a massive reassessing of their past foreclosures, and that?s delaying the processes.?
Johnson said he?s anticipating the banks to encourage homeowners who are in trouble keeping up with their mortgage payments to list them as short sales, where the house would be sold for less than it would appraise for. An estimated 43 percent of all Inland homeowners are upside down on the mortgages, meaning they owe more than the home?s current value.
Homeowners who are in trouble are advised to move slowly and get as much advice as possible, said Melinda Opperman, senior vice president for Springboard Non-Profit Consumer Credit Management, a Riverside-based counseling service.
Opperman said a recent federally sponsored study found that 70 percent of those who sought counseling ultimately got to stay in their homes, and 56 percent were able to catch up on payments.
Opperman added that, after the settlement between the major lenders and the federal and state governments was reached, opportunists started sending distressed homeowners come-ons in the mail, trying to ?piggyback? on the settlements.
?They?re trying to capitalize on that, but they?re for-profit bad actors,? Opperman said.
The high rate of foreclosures also has an effect on businesses in the area, although it is more of an indirect one. Morris Myers, executive director of the Economic Development Corp. of Southwest California, said most of the businesses he deals with in the Temecula area are sound.
But it doesn?t help an employer if a significant number of her or his workers are in trouble with their mortgages, he said.
?Certainly there?s a psychological effect,? Myers said. ?I think there?s less, though, of an absolute effect.?
Mortgage mud
One of every 213 Inland homes is in some sort of foreclosure distress, making it the metropolitan area with that highest incidence.
Riverside-San Bernardino: 213
Miami: 273
Atlanta: 298
Phoenix: 313
Tampa: 315
Chicago: 321
Detroit: 363
San Diego: 394
Los Angeles: 412
San Francisco: 514
Source: RealtyTrac
Article source: http://www.pe.com/business/business-headlines/20120517-real-estate-inland-empire-tops-dubious-foreclosure-list.ece
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