Foreclosure Hits Rural American
Only half a dozen turned up at the Merced County court to attend a foreclosure auction. The first property that came up on the list was the Pimentel dairy farm. Janice Pimental and her son Nick were also present on this day that was sad for them. The flashy auctioneer in sunglasses and jeans made the announcements and waited for bids. There were none. The dairy farm had been in operation for more than two decades – it being a family concern. It has now become the property of the local lender. Janice accepted the fate stoically.
The Pimental farm is in the luscious Central Valley of California – the famous fruit basket of the country. Today it has the highest number of foreclosure concentrations. Many are situated in rural towns. The foreclosure melt down is changing forever the character of this region.
The focus is on what is happening in the big cities but rural America has not been spared. This is the analysis of Housing Assistance Council, a non-profit organization based in Washington. Executive Director, Moises Loza commented that foreclosures are sparing none – “it is happening all over”. In fact the problem seems to be more widespread in small towns rather than cities. Rural housing includes 15% of the houses being mobile and prefabricated units. Three quarters of the latter were bought from loans taken on personal property and not mortgage. Thus when default occurs the property is taken over without going through the process of foreclosures. Here in rural America there are less banking bodies and so there is not much to choose from. It is easy for the people to fall prey to high interest rates and predatory lending. Accurate statistics of the rural scene is hard to obtain. In metropolitan areas the federal law makes it compulsory to disclose all lending operations. But this is not so with rural financial houses.
Merced County is ranking high on the foreclosure County list – it ranking 4th. San Joaquin County (where Stockton is located) ranks 2nd. Stanislaus County (with Modesto) ranks 3rd while no.1 is Caper Coral-Fort Myers in Florida.
In the three counties in California foreclosures were started on 3,100 units. Of these 1,300 were repossessed. One out of every one hundred units were tainted by foreclosure – the national average being one out of 557 houses. Those counties, like Merced, that witnessed a housing boom are today the worst sufferers.
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