Possible local foreclosures jump

There’s been a huge increase in the number of Luzerne County home owners facing possible foreclosure, but the share of homes in jeopardy still is less than the national average.

RealtyTrac, a California firm that monitors and sells foreclosure information nationwide, said 828 Luzerne County homes were in some stage of the foreclosure process during the first six months of 2007, compared to 314 in the same period of 2006. The spike continued a three year trend – only 141 mortgage holders were in similar trouble during January to June 2005.

While the number was up dramatically since last year, it was only 4 percent higher than in the second half of 2006, a modest change compared to a 32 percent increase nationwide.

Even with the increase, the current rate of foreclosure filings is only 1 per 177 households in Luzerne County. That’s better than the national average of 1 per 134 households but worse than RealtyTrac’s average for Pennsylvania of 1 per 335 households.

The highest rate of filings was in Nevada, where 1 in 40 home mortgages is in foreclosure.

RealtyTrac monitors default notices, auction sale notices and bank repossessions.

Luzerne County Deputy Sheriff Ryan Foy was not surprised by the figures; he has noticed an uptick in the number of homes coming up for sheriff sales this year.

“It has picked up,” he said Tuesday, although he couldn’t identify any particular reason. New sale properties have been running slightly higher, while those that have been continued are up due to a change in law that makes it easier to postpone a sale. Sales are held every two months beginning in February.

“All they have to do is request a continuance” and property owners can put off a sale while they try to negotiate with creditors, Foy said.

Exotic mortgages that require little or no down payment or proof of a borrower’s ability to pay are blamed for rising national delinquencies, and this area is not immune, said Eric McCabe, president of McCabe Mortgage Group in Kingston.

“There’s been a lot of dumb things done” by both borrowers and lenders, he said, although maybe not as much here as in other areas.

“The good news about our market is the values have remained relatively stable,” he said, so most mortgage holders aren’t stuck with a home worth less than their balance.

For that reason, “locally, I don’t think we’ll see any huge fallout,” he said.

While RealtyTrac said Luzerne County foreclosures were 164 percent higher in the first six months of 2007, statewide foreclosures were down 18 percent. The nationwide increase was 56 percent.

Craig Selner, director of counseling at Community Credit Counseling Services of Northeastern Pennsylvania, said the most common reasons people get into financial difficulty remain divorce, layoff or medical expenses. But while he has not heard of many cases sparked by mortgages, Selner has noticed more clients seeking help with their debts.

“June of last year to June of this year there’s a significant increase,” he said.

McCabe, who is president of the Northeastern Pennsylvania chapter of the Mortgage Bankers Association, said lenders began reacting to the rise in delinquencies nearly a year ago, making it tougher to obtain a loan.

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Firm finds 828 county homes affected in first half of ’07, but figure well below national average.

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