Mortgage

California foreclosures remain below pre-crisis levels

California foreclosure activity inched higher in October but has been hovering around the same benchmark since June, which is at or below pre-crisis levels, PropertyRadar reported.

Notices of default increased 15.3% in the state during the month of October, offsetting the 19.5% drop experienced in September.

Notices of trustee sales increased 4.1% but dropped 59.2% for the entire year. Meanwhile, foreclosure sales jumped 3.9% for the month, while sinking 65.4% for the year.

While the low level of foreclosures seems to be good news, the reality remains that 1.5 million California homeowners are underwater and at risk of default. The numerous laws that either prevent or delay foreclosures thwart economic growth by trapping homeowners with negative equity. Negative equity, in turn, prevents underwater homeowners from selling an existing home or buying another, which keeps much-needed for-sale inventory off the market. 

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