The nature and process of San Diego Foreclosures
There has been a rising trend in San Diego Foreclosures. It coincides with growing unemployment rates. Once a home goes to foreclosure status, a bank will try to auction it. If it fails to get a winning bid, the property’s status will return to REO (Real Estate Owned), in the hands of the original lender.
California accounted for 28% of foreclosures in 2009, nation wide-an increase of 32% more than the same quarter, previous year. Of this, top five county foreclosures were reported by Southern California. San Diego Foreclosures ranked fourth among the counties. More than 3600 city mortgages went into default last month. Foreclosure filings topped 7000 in San Diego County last month, 30% higher than in April, 2008. San Diego Mortgage delinquencies also coincided with rising figures of unemployment, indicating a cause and effect.
Experts point out that some lenders have toughened their lending criterion leading to precluding of majority of San Diego buyers. This led to fall in property levels, especially in outlying areas of San Diego where they are down by 40-50%.
Foreclosures proceed in the following way:
• First step is the issue of a Notice of Default occurring mostly 3 months in advance of filing a foreclosure. Some lenders may allow concession like making partial payments and arranging a short sale. But most will restrict to 3 months limit.
• After three months of default, a Notice of Trustee Sale is issued which is like a formal foreclosure. An auction of the property can now occur within 14 days from this notice. A bid is set accounting for principal, arrears and fees.
• If bids are below this level, the property returns to the Bank and is termed Real Estate Owned (REO).
There are two kinds of foreclosures in California- Judicial and Non judicial.
• Judicial involves sale of property supervised by the Court. It involves the lender suing the borrower. Judicial Foreclosure is a rarity.
• Non Judicial foreclosure is more popular. The Deed of trust includes a power of sale clause. It is a quicker process.
Foreclosure sales are rarely done at the original sale date and may be delayed by one year. It maybe delayed due to a number of reasons like Lender’s decision, mutual agreement between lender and borrower etc.
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ABOUT THE AUTHOR
Ron Akins is skilled writer of Real Estate Foreclosures having 20 years of writing experience. He provides tips and guidelines on buying all types of foreclosures. For more details please visit San Diego Foreclosures.