More Bay Area Homeowners In Foreclosure Trouble

Jan. 24 - KGO (KGO) -- More California families are in danger of losing their homes now than any time in the past eight years. That startling news came today from the Data Quick Information Service which said rising real estate prices, and the risky loans people have taken out, have triggered a 133 percent increase in foreclosure notices to Bay Area homeowners. Only a third of them will actually lose their homes, but clearly, more and more people are falling behind.

A lot of those adjustable rate mortgages are now adjusting. More than 37,000 homeowners received notices of default from their lenders between October and December. It's the first step of the foreclosure process. Bay Area counselors that we spoke to in the housing field tell us they've seen a record number of homeowners coming to them for help.

Maria Benjamin, Community Housing Development Corp.: "We've gone from seeing an average of one to two calls about foreclosure prevention to 10 to 15 calls a week."

Maria Benjamin works with the Community Housing Development Corporation of North Richmond helping people find their way to home ownership. It's part of a nationwide non-profit called NeighborWorks. But besides helping people figure out what to buy, they're now doing much more coaching on how to hang on and minimize losses in foreclosure.

Maria Benjamin: "By the time they call us, a lot of them are desperate, a lot of them are at their wit's end and they're going to lose their home."

In fact, Contra Costa County saw a jump from 541 mortgage default notices in 2005 to more than 1,500 in 2006 -- an increase of nearly 180 percent. Rates in Alameda County more than doubled as well from 456 to to nearly 1,200 -- up 157 percent.

And while mortgages in San Francisco, Marin and Santa Clara counties are the least likely in the state to go into default, each county still saw a significant increase -- up 63 percent in San Francisco, 78 percent in Santa Clara and 98 percent in Marin County.

Jr. Wheelwright, Neighborhood Housing Services SV: "The last six years we've lent out $120 million dollars or helped people to buy $120 million dollars worth of real estate, and none of those people have gone into foreclosure."

Neighborhood Housing Services Silicon Valley is a non-profit direct lender. It's also part of NeighborWorks, with a clear focus on homebuyer education and credit counseling.

Jr. Wheelwright: "We educate people. The real root of the thing is if you buy the right property, you buy the right priced property and you stay within your budget, your income, you can afford to make the payments."

While the majority of California homeowners come out of the foreclosure process by refinancing or selling their houses, nearly a third lost their homes to foreclosure last year compared to just eight percent the year before.

Experts agree, if you find yourself struggling to make your mortgage payments, get counseling help as soon as possible.

For information on local housing counseling agencies to help with loss mitigation counseling, contact the Homeownership Preservation Foundation at 1-888-995-HOPE (4673) or visit their Web site at www.hpfonline.org.

To learn more about NeighborWorks, visit www.nw.org.

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