Foreclosures Drop for 4th Consecutive Month

The number of Ventura County homeowners going into foreclosure dropped for the fourth consecutive month as higher prices and strong home sales helped rescue more distressed properties before the foreclosure process started, reports a real estate information service.

Lenders started foreclosure proceedings against 209 homes in Ventura County in March, down 23% from the 272 for March 1996. Statewide, the number of foreclosures begun in March was 12,182, down 21.3% from 15,473 for March 1996, according to Acxiom/DataQuick Information Systems.

The year-ago numbers were a record and reflected a tightening of lender foreclosure policies. Still, market watchers were encouraged by the steady decline in 1997.

“A home usually won’t go into foreclosure unless the homeowner owes more on it than it’s worth,” said Michael T. Ela, DataQuick president. “With today’s prices going up, fewer homeowners find themselves in that situation. They can sell for enough to pay off what they owe.”

Homeowners most often are six to eight months behind on their mortgage payments when a bank starts foreclosure proceedings, according to DataQuick.

From beginning to end, the formal foreclosure process can take as few as four months, although today it averages more than seven months.

When a foreclosed property is resold by the bank, the selling price averages 7% to 9% less than similar homes on the market, putting downward pressure on prices. A year ago, that differential was more than 15%.