Will the rate of California foreclosures finally begin to go down or stabilize out in the Golden State? That is a question currently up for debate, though many experts looking at a California real estate market are hopeful that state leaders have finally gotten a handle on a foreclosure rate that had been steadily increasing over the last few years.
In the nation and over the course of the current recession, an average of 250,000 to 300,000 home owners a month found themselves dealing with the foreclosure process. California is one of six states in the country that has contributed almost 60% of the foreclosure total since late 2008, when the financial markets suffered steep declines. California, Florida and Arizona together account for 44%.
California also is the leader in the number of cities that have the highest rates of foreclosure, placing six of its municipalities within the top 10 nationwide. What this helps to do to the rate of California foreclosures is complex and it appears that California has some distance to travel if it hopes to get a handle on foreclosures while also bringing in increasing revenues from its property inventory.
As far as the cities within California, the state has the number three and number four positions (Modesto and Sacramento) while also running the table from five through eight as well. There is no particular region hardest hit, and cities are located in both the southern and northern areas of the state. California is large, unfortunately, because any other state would have been dealt a fatal blow from having so many cities on that list.
Fortunately, the Golden State was hanging in there and trying to deal with the rate of CA foreclosures as best it can and with the help of the federal government, which has offered certain mortgage stabilization and foreclosure prevention programs to the state’s residents. Unfortunately, though, many people bought a lot more home than they probably should have at the peak of the real estate boom.
Many of these home owners are occupying properties that are worth less than half, in extreme cases, and what they paid for them. They owe much more on their homes and the home would be worth on the market. To compound issues, they got into these homes using exotic home loans that were bound to rise greatly in terms of payment. This has also increased the rate of CA foreclosures as well.
At present, 1 in every 409 homes in the country has begun to enter the first stages of the foreclosure process. In California, that rate is probably somewhat higher, meaning that it will be vital for leaders to stabilize real estate markets as best they can in order to ride out the continuing storm that the recession has caused, especially in California.
There has been signs lately that it just may be possible to get the rate of California foreclosures down to manageable levels once again. Recently, there’s been a month-over-month drop, both nationwide and in California. This could be extremely good news over the long-term. If things can be straightened out, California could once again become the “golden” state it once was.
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