The Stockton Story Of Riches To Rags

Posted in Foreclosed Homes, Foreclosure, Foreclosure Homes, Foreclosure Listings, Foreclosures, August 15th, 2007 |

Stockton was once a haven for house hunters. The Bay Area had become too hot to touch – overcrowded and costly. So people opted for Stockton. But today the picture is desolate with ‘For Sale’ signs dotting the scene. Foreclosures waves are lashing the country and Stockton has the dubious distinction of leading the bandwagon with the highest numbers of foreclosures nationwide.

Stockton is a city kissed by the Sun with 285,000 residents. It lies 90 miles to the east of San Francisco. Over the last ten years the number or residents have gone up as more people turned away from the Bay area hunting for affordable housing units. Then why has the milk suddenly turned sour? It is mainly because of houses bought with loans taken from the sub-prime category. These were teaser loans. Sometimes for a negligible down payment most of the initial financing was waived. But within a year or two the lender began to demand higher monthly instalments, which the borrower just could not afford.

Alma Neri, mother of three is one of the householders caught in this vicious net. The Neris lived in one house and invested in another planning to sell the first one and move on to the second. But now both the houses are sitting idle and the family finding it impossible to meet mortgage commitments for both. Debt is piling up while equity is falling. It is the same grim picture within a half-mile radius of their residence.

Six cities in California are leading in this number game. California, with 54,000 default notices in the second quarter of this year, ranks third after Nevada and Colorado in the foreclosure race. A non-profit organization is trying to do some rescue work by writing to lenders asking them for a stay.

The worst affected are the seniors and coloured citizens. But the infection is now spreading vertically and horizontally cutting across all line differences.

In June state leaders made a hue and cry about forming a forum but in most of the cases help was coming in too late. The damage had been done. The lender should have been approached much earlier.

Stockton brokers are now opting for short sales wherein the owner directly sells the property at a low rate hoping to clear at least a major part of the mortgage. Even then buyers are not available.

Via