Defaulted Loans Fuel Foreclosure Frenzy
Adjustable rate mortgages are the main cause.
Help is available
for homeowners and taking early action can save a home.
 THE ROAD TO FORECLOSURE: There are four main steps in the foreclosure process. The links make it easy to understand how it works:
You’re behind in your payments
Notice of Default
Notice of Sale
The foreclosure sale
HOW DID WE GET HERE?: Foreclosures are on the rise in Los Angeles County. The main cause is the rise in adjustable mortgage rates for homeowners who purchased in the past two years.
There are other reasons too. Sometimes bills just pile up. It could be because of unexpected emergencies or loss of a job. Perhaps you delay paying something to pay something else. Eventually it catches up and you might not have enough money for everything.
A slowing market =
a growing problem
As home sales slow down and prices flatten out, more homeowners are defaulting on their mortgage loans. And they might not have the equity to refinance or sell their homes to avoid foreclosure.
As recently as 2005, if someone couldn’t afford a home they could easily sell it at a profit and avoid any problems.
But the market started cooling in the fall of 2005, making selling difficult. By mid-2006, the number of Notices of Default, the first step of the foreclosure process, began to rise greatly. |
WE CAN HELP: Our counselors are available to answer your questions. To contact a DCA real estate representative, call (800) 973-3370.
Keven Chavez, Public Information Assistant
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