Some of These People are Stupid...
"Foreclosure activity accelerated this summer in Sonoma County, rising to a seven-year high as homeowners found they no longer could rely on rising home prices to fend off financial woes."
"The Bay Area experienced an 89.2 percent increase, with Solano County's 171.3 percent increase being the largest."
"Default notices jumped 83 percent in Sonoma County during the third quarter, following a 53 percent increase in the second quarter, according to Data-Quick Information Services, a La Jolla-based company that released the figures Wednesday."
"The third-quarter spike was the largest percentage increase in at least 14 years - as far back as the DataQuick records go."It has the potential to be a very big problem," Cutts said. "I definitely think it's a worsening problem."'
'"Some of these people are stupid, and others got caught by unscrupulous lenders," said Amy Crews Cutts, deputy chief economist with Freddie Mac. "And others just had bad luck and couldn't make their payments."'
"Under particular duress are residents who took out mortgages near the peak of the housing market in August 2005 or later, particularly those who used nontraditional loans, such as interest only or negative amortization, real estate analysts said."
"More than half of California's default notices came from loans created in the past 14 months, according to DataQuick."
"Negative amortization and interest-only loans have the highest default rates - nearly double the rate of traditional loans, Cutts said."They are performing much worse," she said. Some people used these types of loans to get into houses they otherwise could not have afforded."
"Homeowners under financial stress are finding it more difficult to sell their properties quickly and pay off their debts. Home sales tumbled almost 40 percent in September compared to a year ago, while prices have dropped 7.7 percent in Sonoma County - the most in the nine-county Bay Area."
"As a result, lenders are initiating foreclosure proceedings against a small but growing number of homeowners."