Posted by: Tony Carson | 27 October, 2007

California foreclosures: screwing of the middle class?

Are US foreclosures a sign of lousy lending practices or that the middle class is, indeed, being screwed by the US economy?

Whether the answer, it is scary:

Californians lost their homes to foreclosure in record numbers for a second straight quarter, and the trend is creeping into affluent communities, figures released Friday show.

Foreclosures statewide hit a new high of 24,209, besting the previous record by 39%, according to DataQuick Information Systems. Default notices — the first step toward foreclosure — rose to 72,571 for the three months ended Sept. 30, breaking a record set in 1996.

Separately, the Census Bureau reported that the nation’s homeownership rate fell for a fourth straight quarter, the longest decline since 1981. The agency said foreclosures helped push the number of vacant homes to a record 17.9 million.

In California, foreclosures are concentrated largely in outlying areas such as the Inland Empire, the Antelope Valley and the Central Valley, where swarms of people with modest incomes used loans with low “teaser” rates to finance their purchases. But data released Friday show that the pain is spreading to higher-priced neighborhoods in Los Angeles and Orange counties and is even trickling into wealthy communities.

Full story here: California home foreclosures again set a record


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