Metro areas in four Sun Belt states accounted for the top 20 foreclosure rates in the nation last year, according to a report this week by foreclosure data company RealtyTrac.

Nine of those cities were in California, eight were in Florida, two were in Nevada, and one was in Arizona. RealtyTrac’s Year-End Metropolitan Foreclosure Market Report analyzed foreclosure properties in metro areas with more than 200,000 people.

The nation as a whole posted a total of more than 2.82 million foreclosure filings, or 2.21 percent of all housing units.

Foreclosure activity also showed signs of spreading to previously insulated Utah, Illinois, Oregon and Idaho, the report said.

"While it was expected that cities from states with the highest levels of foreclosure activity would top the charts, there is evidence that we’re entering a new wave of foreclosures, driven more by unemployment and economic hardship than what we’ve seen over the past few years," said James J. Saccacio, CEO of RealtyTrac.

"Areas like Provo, Utah, Fayetteville, Ark., Portland, Ore., and Rockford, Ill., all posted foreclosure rates above the U.S. average in 2009. And markets like Honolulu, Minneapolis and Seattle saw foreclosure activity increase at more than twice the national pace over the past 12 months — although all three of those markets still had 2009 foreclosure rates that were at or below the U.S. average."

The Las Vegas/Paradise metro area saw the highest foreclosure rate, with 94,862 filings, or 12.04 percent of the area’s total housing units. That’s more than five times the national average.

The Cape Coral-Fort Myers metro area in Florida posted the second-highest rate with 11.87 percent, or 42,862, of its housing units in foreclosure. Merced, Calif. saw the third-highest rate with 10.1 percent, or 8,389, of its housing units receiving a foreclosure notice. The Riverside-San Bernardino-Ontario area had the fourth-highest rate in the nation at 8.8 percent. Other cities in the Central Valley were also hit hard: Stockton had the fifth-highest rate, at 8.62 percent, and Modesto had the sixth-highest, at 8.53 percent.

RealtyTrac collected the data for the report from more than 2,200 counties nationwide, accounting for more than 90 percent of the U.S. population. …CONTINUED

Foreclosure rates in California dropped 24.3 percent, to 84,568, in the fourth quarter, according to another, quarterly study by DataQuick Information Systems. Foreclosure filings have been dropping since an all-time high of 135,431 in the first quarter. Filings fell to 124,562 in the second quarter and to 111,689 in the third quarter.

July 2006 was the median month of origination for loans that went into default for every quarter in 2009.

"Mid-2006 was clearly the worst of the ‘loans gone wild’ period and it’s taking a long time to work through them," said John Walsh, president of DataQuick.

The lenders that originated the most loans that went into default last quarter were the most active lenders in the second half of 2006, according to the report. That includes Countrywide with 5,588 loans in default, Wells Fargo with 3,482, Washington Mutual with 3,460, Bank of America with 1,760, and World Savings with 1,869.

The most affordable 25 percent of homes on the market accounted for 52 percent of foreclosures in the fourth quarter of 2008. A year later, that number fell to 39.4 percent, indicating that mid- and higher-end markets are now feeling squeezed.

"Homeowners (in those markets) were able to make their payments longer than homeowners in entry-level neighborhoods, but because of the recession and job losses, that’s changing. Foreclosure activity is a lagging indicator of distress," Walsh said. 

California homeowners were a median five months behind on their primary mortgage payments, and owed a median $13,510 on a median $325,818 mortgage when the lender filed a notice of default, the report said.

Foreclosure resales declined from 42.7 percent to 40.7 percent of all California resale activity last quarter. They varied substantially by county, from 9.3 percent in San Francisco to 69.5 percent in Merced.


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