(Source: Brook Stockberger Las Cruces Sun-News, N.M. (MCT) — The foreclosure rate in the Las Cruces area has actually fallen. According to CoreLogic, the most recent stats, from April, point to a year-over-year decline in the rate of Las Cruces area foreclosures among outstanding mortgage loans.
Not only that, but the Las Cruces area is better off, statistically, than many other places in the country
“Foreclosure activity in Las Cruces was lower than the national foreclosure rate,” reports CoreLogic’s Lauren Salay. “Also in Las Cruces, the mortgage delinquency rate remained unchanged.”
The foreclosure rate was 2.20 percent in April, down from 2.22 percent the year before.
That’s good news, right?
Yes, experts say that is good news, but those statistics do not tell the whole story.
Underwater/principal reduction
“The important number for us to measure and track is (how many) homeowners are underwater, this is a better indicator of people that are struggling to keep their life on track and not fall into foreclosure,” said Sara Nolan, director of CAFé, a nonprofit that helps low-income families.
A person is “underwater” with his or her mortgage when they owe more on their house than it is worth in the market. Nolan is in favor of the practice of principal reduction, where some of the value of the mortgage is reduced.
“We are organizing homeowners that are underwater and at risk of being underwater because we can prevent these foreclosures and get our economy recovering through
principal reduction which the Obama Administration and the big four financial institutions have refused to discuss seriously,” Nolan said.
CNNMoney recently reported that a report by Amherst Securities shows that the practice works well.
“Only 12 percent of borrowers who received principal reductions re-defaulted in 2011, Amherst found. That’s compared with 23 percent of borrowers who received mortgage modifications with interest rate reductions (but no principal reduction), and 30 percent who received forbearance, which postpones their debt repayment.”
Help is available
Dolores Rosell, housing coordinator with YWCA, said that many people still need help wading the waters of delinquency.
“I know lenders are more active contacting their borrowers, but most of the time the paperwork is so overwhelming that they (borrowers) give up,” she said.
The Fair Lending Center at the United South Broadway Corporation – a nonprofit law office – reports that homeowners are allowed to defend themselves in court during the foreclosure process, but many defendants do not have representation.
YWCA’s Consumer Credit Counseling Service in Las Cruces can work with people facing mortgage issues. It’s office is located at 277 E. Amador Ave., Suite 308, and the phone number is (575) 532-1222.
CAFé works in areas such as education and job creation, and is also active in the foreclosure realm. CAFé is non-denominational, but works with religious organizations and can be reached at (575) 520-1624
Brook Stockberger can be reached at (575) 541-5457
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©2012 the Las Cruces Sun-News (Las Cruces, N.M.)
Visit the Las Cruces Sun-News (Las Cruces, N.M.) at www.lcsun-news.com
Distributed by MCT Information Services
Source: Brook Stockberger Las Cruces Sun-News, N.M. (MCT)
