Homeowner Foreclosures and Default Rate Down Due to New Regulations!
According to a recent real estate report fewer homeowners in California and the Bay Area are struggling with their mortgages due to the rise of home values and new regulations that have been put in place.
The report shows that in the second quarter, both foreclosures and default notices were less than half their rate at the same time last year.
“A foreclosure only makes sense when the home is worth less than what is owed on it,” said president of John Walsh, DataQuick, an .independent provider of real estate information and analysis. “As home values rise, fewer homeowners owe more on their homes than the homes are worth.”
Fewer Homeowners Received Default Notices From April Through June
From April through June, 3,772 Bay Area homeowners received notices of default, which is less than half of the homeowners the who received the late notices during the same time in 2012 (which was 8,572), DataQuick said. Statewide, the 25,747 default notices also were less than half of the 54,615 notices issued a year earlier.
The report shows foreclosures fell by an even bigger margin. In the Bay Area, 1,255 homes were taken back by lenders in the second quarter – marking a 59.3 percent decline from 3,083 a year earlier.
Every county in the region saw similarly steep declines in foreclosures. The biggest percentage drop in Santa Clara County, where they fell 67.9 percent to 126 bank repossessions in the second quarter.
California’s Homeowner Bill of Rights, which took effect on Jan. 1, slows down the foreclosure process and requires lenders to make more attempts to stave off foreclosures through modification of mortgages. As the law took effect notices of default fell sharply. During the second quarter they rose slightly, but still remained low when compared to previous years.