Foreclosures down, but read the fine print

It looks like good news: foreclosures are down in California. But KPCC’s Nick Roman says you have to read the fine print.

Nick Roman: The number of foreclosure notices sent out statewide in April, May, and June was about 8 percent lower than for the previous three months. But don’t read too much into that.

La Jolla-based Dataquick says lenders have a backlog of distressed properties, and they simply sat back to revise foreclosure policies. The real estate info firm says lenders are bringing in more staff to get foreclosure paperwork moving. It expects that more default notices will go out this summer.

Dataquick says many of the loans in trouble now originated three years ago. That was the heyday of the home loan boom.

The lenders with the greatest number of loans that went into default last quarter were Washington Mutual, Wells Fargo, and Countrywide. Wells Fargo just reported higher earnings, despite nagging loan troubles. But Washington Mutual is long gone, gobbled up by Chase. High-flying Countrywide is gone, too. Bank of America is now cleaning up the mess Countrywide left behind.

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