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A blog about the economy and the Sacramento-area real estate market.

March 19, 2009
Nuggets, tidbits and quotes from the Calif. foreclosure crisis
Wednesday, I sat for three hours before the California Senate Banking Finance and Insurance Committee hearing on plans by the Obama Administration and State of California to rein in foreclosures. These are the kind of places where experts come wtih facts and figures and quotes:  Here's a few from the reporter's notebook:

  • "There's just an ungodly number of faxes that get lost when we send them to (loan) servicers. We have to re-send and re-send and check in two weeks."  - Martha Lucey, President and CEO, By Design Financial Services.
  • There are still 530,000 licensed real estate agents and brokers in California despite this downturn. - California Department of Real Estate.
  • "Last year there were two foreclosures per minute in California and 60 will lose their homes during this hearing." - Sen. Ron Calderon, D-Montebello, and committee chairman.

  • "Every day, 1,000 people in California are being notified of having a Notice of Default and predators are preying on them." - Jeff Davi, Commissioner of Department of Real Estate.

  • "We estimate there will be 460,000 foreclosures this year in California and 1.5 million over the next four years - one in every four mortgages existing today. That's absent the effectiveness of these programs." - Paul Leonard, California director, Center for Responsible Lending.

  •  45 percent of loan modifications end up costing the borrower a HIGHER monthly payment. (That's with late fees, penalties and adding unpaid amounts to back of mortgages. The amount owed grows and pushes up the monthly payment for people who were in trouble with the payment in the first place. And this explains why half of last year's modifications ended up with re-defaults) -  Paul Leonard, CRL.

  • Wells Fargo services 9 million U.S. mortgages, about one in every six. Collectively, they are worth $1.5 trillion in unpaid balance. The bank did 706,000 foreclosure prevention solutions last year, about 22 percent of the U.S. total.
  •   30 percent of the bank's loan modifications return to delinquency after the initial modification. - Joe Ohayon, VP, community and client relations, default and retention operations.

  • Credit unions in California and Nevada have $54.1 billion in real estate loans, consisting of firsts, seconds and home equity lines of credit.Their foreclosure rate is 0.16 percent. About 1.35 percent of credit union mortgages are 60 days or more late. Credit unions have already modified 72 percent of these delinquent loans - without being pressured by the government to do so. - Melissa Ameluxen, director of state government affairs, California and Nevada Credit Union League.

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