Foreclosure and distressed property topics

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10 Sharpsburg is back. what a surprise.

From Zip

List Price: $799,900

Bedrooms: 4

Full Baths: 2

Partial Baths: 1

Square Feet: 2,710

Lot Size: 5,300 Sq. Ft.

Year Built: 1979

Listing Date: 09/05/07

On Market: 0 day

Type: SFR

Status: ACTIVE

MLS #: S504184
 
Technical Question on Foreclosures:





Are all the foreclosures we are seeing on re-financed properties trustee sales as opposed to deficiency judgments?





If so, then perhaps my point is moot, but I believe in California a re-finance does not provide a borrower with anti-deficiency protection, i.e., a noteholder can come after a defaulting homeowner personally on a refi as opposed to on a purchase money loan (the original loan).





I ask this because in watching some recent foreclosures I am having a hard time believing that people blew as much cash as they took out of their home ATM. So far in Newport I have seen two properties where the owners refi'd and pulled out more than $500K each, but managed to go into foreclosure within 3 years - how the heck did they spend that much cash in such a short period of time with nothing to show for it?





I admit, my curiosity is based on my own considerations as a homeowner in 2003 - I weighed whether to max out the equity at fixed low interest rates and arbitrage the money into a higher performing REIT and taking the difference. I didn't do it, but I wonder where some of these epople put all that money - and if they did put it somewhere then whether it might be worth looking for?





Any thoughts are greatly appreciated.
 
TangerineSpeedo,





<em>" I am having a hard time believing that people blew as much cash as they took out of their home ATM."</em>





Believe it. I don't think your typical Southern California consumer would have any difficulty blowing $500K in three years if given the opportunity. It was free money during the bubble.
 
<p>OC August foreclosure estimates with a per business day calculation:</p>

<p>1423 NODs 62 per day.</p>

<p>604 NTSs filed 26 per day.</p>

<p>498 Trustee deeds filed 22 per day.</p>

<p>Keep in mind August had 23 business days which is probably the highest for the year. Even if the per day increases next month the MSM and the like will say see it is ebbing. September only has 20 business days, so the per day number is more important. </p>

<p>Currently OC is at a 52% NOD to foreclosure ratio and just two months ago it was 40%. This would equate to 3400 foreclosures in the next six months. As the NODs keep increasing 2007 could easily have over 13,000 NODs. This would be one of the highest on record with 96 having 19,883 and breaking 93's record of 11,566. This rate of increase is rising faster than the 90-93 rate. </p>

<p> </p>
 
Irvine Renter,





I know people can be extravagant, but that's a lot even for flashy OC. In the end, it's probably too high a risk to undertake unless you had personal knowledge of a person's assets.
 
Don't forget the remodels. There was a lot of remodeling work with trophy kitchens, extravagant master baths, etc. There were also significant purchases of second homes. It wasn't all Hummers and Prada.
 
<p>I know people trying to sell their "investment property" as quickly as possible (in places like Phoenix, Las Vegas, Inland Empire) who are trying to sell and payback the HELOC they took out to purchase these homes. Come to find out, one of them is doing an interest only on their primary residence while doing this type of "investments", and will reset within the next year. Sad...</p>
 
<p>Ok I have been lagging but here are good ones this week. The county was closed yesterday so the fun started today.</p>

<p>172 Hayward 92602 went back to the bank today for $516k.</p>

<p>28 Quartz Ln in Ladera 92694 went back to the bank today for $412k. This tract has over half of the listings bank owned and at that price it is less than the builder was selling them for in 2004.</p>

<p>3037 Snead Pl in 92782 went back to the bank for $614k. </p>

<p>For the rest of the week we have:</p>

<p>4052 Germainder Way 92612 NTS of $590k on 9/12.</p>

<p>17 Saint John Dana Point 92629 NTS of $915k on 9/13.</p>

<p>33232 Acapulco Dana Point 92629 NTS of $185k on 9/13.</p>

<p>25701 Fishermans Dr. #211 Dana Point 92629 NTS of $574k om 9/13.</p>

<p>You have to Zillow this one 4260 Cedar Creek Yorba Linda NTS of $1.888bil on 9/13.</p>

<p>2769 Hillview #5 NB 92660 NTS of $544k on 9/14.</p>

<p>888 Summit Dr. LB 92651 NTS of $1.04mil on 9/14.</p>

<p>Next week we have some more in Irvine especially 92602.</p>

<p> </p>
 
<em>"I know people trying to sell their "investment property" as quickly as possible (in places like Phoenix, Las Vegas, Inland Empire) who are trying to sell and payback the HELOC they took out to purchase these homes."</em>





Someone on the main blog stated the HELOC phenomenon did not cause the bubble but was a result of it. I don't agree. I think a great deal of HELOC money went into investment properties which directly contributed to the inflation of the bubble. People trying to get this money back out to pay off the HELOC will hasten the stampede.
 
<p>The DataQuick numbers for August are out. 1476 NODs, I was under by 53 and the foreclosures were 469, I was over by 27. I should always be too high on the foreclosures since DQ only uses SFRs and condos. The data I pull has commercial property as well and I can't tell what is what. </p>

<p>This translates to a 44.3% NOD to foreclosure ratio. If the ratio continues OC will have over 2900 foreclosures in the next six months. YOY the average per month increase in foreclosures is 41.8% and the average increase per month for NODs is 12.6%. July had 17.5 foreclosures per business day and August had 20.4 per business day. This is an increase of 16.6% compared to the increase of 18.2% in July. </p>

<p>September only has 18 business days compared to August which had 23. This means the monkeys at the MSM will report that foreclosures are slowing because the monthly number will undoubtedly will come in lower. However the last two months have averaged an increase of 17.4% on a per day basis. If that is a good guess for next month the foreclosure number will be around 431 a drop of 8.1%. I posted something similar on Padilla's blog but we will see if he still has a headline next month of foreclosures decreasing. </p>

<p>August had 1961 resale homes sold and 1476 NODs. With Steve Thomas' data on pending sales currently under 1300 September could easily see NODs exceed the amount of sales. OUCH!</p>
 
When the ratio of total sales to foreclosures goes under 2, according to <a href="http://piggington.com/sales_and_defaults_a_logarithmic_look">Rich Toscano's research</a>, it is the death of the market.
 
<p>Going by Rich's NOD to sales number in July OC was at 2.05 for total sales and 1.83 for resale only and for August it was 1.55 for total and 1.33 for resale only. So we have a flatliner.</p>

<p>______________________________________________________________________________________________________</p>
 
I think a poster from IHB leased or rented his property. I hope things are going well for her. Wouldn't it be stressful to be renting a place that was in foreclosure? How usual is it to be able to work out something with the lender to keep on renting?
 
<p>As Ara Hovnanian said at conference for builders in Florida in July "You need to raise your prices. There is a sense of fear out there. And if you keep lowering your prices they are going to continue to wait because they know you will just lower them again." </p>

<p>I think he needs to heed his own words. It looks like he is right in the sense people know that they will just lower the prices again. Especially since their fiscal year end isn't until next month. If you think they are motivated to move homes now just wait until they realize they hit their goal this month. Next month will be the sale of the millenium.</p>
 
Just got a Realtytrac alert on 2401 Ladrillo. This has been a short sale attempt all summer, so I'm assuming that the alert is for an NTS? Can anyone see the details?
 
<strong>Foreclosures in OC only 4 in every 1,000</strong>


October 24, 1992

<strong>Byline: Rob Perez </strong>

<strong>The Orange County Register</strong>

<strong></strong>

Despite a rapidly escalating rate of foreclosures, only four of every 1,000 Orange County homes have been taken back by lenders this year _ the lowest ratio among Southern California counties, a survey released Friday shows.

For the first nine months of 1992, Orange County had 4.5 foreclosures per 1,000 owner-occupied households, compared with the average of 7.1 for all of Southern California, according to TRW REDI Property Data. Riverside County topped the list with 11.4.
 
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