Mortgage delinquencies and foreclosure activity continued to rise in January among Sonoma County homeowners.
The rate of delinquent loans reached 7.3 percent in January, or about one in every 15 mortgage holders. That compares to 4.23 percent for the same month a year ago, according to First American CoreLogic.
Delinquent loans are those that are 90 days or more past due. It includes homes in foreclosure or taken back by the banks.
The foreclosure rate reached 2.23 percent, compared to 1.2 percent in January 2009. The rate measures loans in any stage of the foreclosure process.
Foreclosure activity was 3.75 percent for California and 3.19 for the U.S. The delinquency rate was 11.64 percent for the state and 8.66 for the nation. All those rates were reported to be higher than a year ago.
First American reported that the county foreclosure and delinquency rates rose steadily during the past year.
Given that trend, it seems noteworthy that the rate of homes taken back by lenders has steadily decreased. The real estate owned, or REO rate, fell in January to .44 percent. In January 2009 the rate was .87 percent. The rate measures homes not sold at foreclosure auctions and, thus, returned to the lender.
Local real estate agents have noted this REO trend. They said in 2008 the banks often priced homes so high at auction that investors refused to bite. The result was the lenders took back large numbers of homes and then had to turn to real estate agents to sell them.
Today, the agents said, the banks often delay the auctions. But when they allow one to take place, they typically price the homes so that investors will buy them. Thus, the lenders end up taking back fewer homes.
James Madison, a Coldwell Banker in Santa Rosa who specializes in REO homes, has seen this trend play out in his own business. In 2008 he sold a whopping 486 foreclosure homes, roughly one in every 10 houses and condos that sold in the county that year. That accomplishment put him among the top 10 agents in the nation.
But as a result of the lenders’ new approach at auctions, Madison told me his sales fell to 325 last year. For 2010, he expects the number will dip below 300.
– Robert Digitale