1.1 million California families endured foreclosures past decade
By Ron Trujillofirstname.lastname@example.org
History often repeats itself. But for the sake of several million homeowners nationwide – including more than 1 million in California – let’s hope the foreclosure crisis is a never-repeated tragedy.
Almost 7.8 million American homeowners – more than the population of Washington state – lost their homes during the foreclosure crisis prompted by the Great Recession, according to a recent CoreLogic report.
Certainly, some of those affected homeowners were approved for no-doc loans or mortgages with rising interest rates with the hope of turning their housing investment into a nifty payday. Instead, many one-time homeowners’ dreams of quick cash became a prolonged nightmare.
And some continue to deal from the foreclosure crisis, from bad credit or sky-high mortgage payments, or both.
The foreclosure crisis had a far-reaching effect on the economy and the housing market nationwide and in California.
Nowhere were foreclosures as devastating as California. The Golden State accounted for one of every seven foreclosures nationwide.
More than 1.1 million California homeowners – or the equivalent of everyone in San Jose, the third-largest city in the state – lost their homes during the foreclosure crisis of 2006-2016, according to CoreLogic.
Cities throughout the state – especially the Inland Empire, Stockton, Sacramento and the Central Valley – were faced with the grim reality of many bank-owned properties.
In fact, California had 193,000 foreclosed properties in October 2009, or more in that month than 40 other states for the entire past decade. Yep, things were awful in California.
Florida had the second-most foreclosures with 960,000 during the past decade, followed by Michigan at a distant third with 553,000.
What a difference a decade makes. Los Angeles had a peak foreclosure rate of 4% in October 2009, and San Francisco reached 2% in September 2011. Both cities have virtually nonexistent foreclosure rates today.
Feature photo by Alex Dean Photography/Shutterstock.com. Secondary photo courtesy of Jeff Turner/Flickr.
Still struggling with your mortgage? Free program is an option
Hard to believe in one of the best-ever housing markets that there are still some homeowners struggling with their mortgage payments.
But layoffs, unaffordable and underwater mortgages are still a problem for some homeowners, especially in slow-to-recover areas of the state, such as the Central Valley, Inland Empire and Northern California, from about Chico to the Oregon border.
For those homeowners, Keep Your Home California could be a solution. The federally funded program has helped almost 71,000 homeowners avoid foreclosure during the past six years.
The free mortgage-assistance program has five programs, including one that covers the payments for out-of-work homeowners and another that provides as much as $100,000 in principal reduction.
Homeowners must have endured a financial hardship – think job loss, cut in pay, divorce or extraordinary medical expenses – and meet county-by-county income requirements, from about $70,000 in low-cost areas of the state to more than $120,000 in the Bay Area region.
The homeowner’s mortgage servicer, the company that collects the monthly payment, must be enrolled in the program. Chances are good that your mortgage servicer has signed up. More than 260 mortgage servicers, including mortgage giants Bank of America and Wells Fargo Bank, participate in the program.
Homeowners should be aware of a forgivable lien on their property in the amount of the assistance received. But the lien fades over time, and the state-managed program only goes after the money if the homeowner sells the home for a profit. It’s a small price to pay for saving your home, including the down payment and the monthly payments, not to mention your credit rating.
Keep Your Home California will continue through 2020, or until the dollars are issued, whichever comes first. At the current pace, the funding could be exhausted by 2019.
If interested, call 888-954-5337 or visit keepyourhomecalifornia.org. The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays.