Home Foreclosures Rising

The San Francisco Chronicle reports:

Despite foreclosures remaining at historic lows, for the past few months default rates have begun rising -- in some places precipitously. In July 2006, Colorado foreclosure rates led the nation for the fifth month in a row, with one new foreclosure filing for every 480 households. That month 3,810 properties entered some stage of foreclosure, which amounted to a 55 percent increase over July 2005. Although the Bay Area has yet to see that sort of bloodletting, experts agree that foreclosure rates will probably rise as more short-term fixed loans become adjustable. In July 2006, 10,025 properties entered some stage of foreclosure in California, over 150 percent more than reported in July 2005. If trends continue, foreclosures may go from a tiny segment of the market to a substantial one, although even the experts are reluctant to guess just how substantial the shift will be.

"There are certainly going to be more foreclosures," says Rick Sharga, vice president of marketing for RealtyTrac, a company that provides listings, training and data on foreclosures nationwide. Sharga says there are typically three ways to avoid foreclosure: Sell the property yourself, find another lender to refinance or get creative financing options from the lender you already have. "Up until now, there have been enough options available, but as inventory rises -- and the buying of real estate slows down -- it's inevitable."

The trend is more foreclosures,we'll bet it's a longterm trend.