Foreclosure trends change, but numbers keep rising - KWWL - Eastern Iowa Breaking News, Weather, Closings

Foreclosure trends change, but numbers keep rising


DUBUQUE (KWWL) -- Home foreclosures continue to scar Americans. One in every 366 households in the country received a filing last month; that was up 14% from November.

California, Idaho, Florida, Arizona and Nevada have the highest foreclosure rates, but Iowa isn't immune. In Iowa, more than 2,200 homes statewide are for sale after being repossessed.

"It's happening in such a bulk, in such a mass number that across the country, it's caught everybody by surprise," Dubuque Realtor Terry Duggan said.

Duggan sells dozens of foreclosed homes in Dubuque each year. In 2008, Duggan Iowa Realty sold 35 foreclosed homes In 2009, 42 homes.

"This year, I think we're going to already be ahead of where we were last year. Right now in inventory, we have 16 homes and this is only just the end of January," Duggan said.

He says foreclosures have been increasing for the last five to six years. Originally, it was based more on risky lending. Now, he says it's changing.

"The new trend is these are people that had good, conventional loans that have lost their job and become unemployed, one of the two spouses , and they based it on probably two incomes."

Other reasons people are defaulting: Health problems and divorce.

Another change: Duggan says you used to see mostly upper-low to middle income earners defaulting.

"Now, we're starting to see it trend out to some of the newer homes, some of the more expensive homes, some of the 200 to 300 thousand dollar homes are starting to pop up," Duggan said.

Duggan says you can get a bit of a deal if you're looking to buy a foreclosed home, but most in Dubuque are posted close to market value because there are buyers around.

"I'd say the average home that I've taken in in repossession, it's only about seven to ten days, and we usually have an offer accepted on the property," Duggan said.

Duggan says the available buyers are a good sign, an indicator that even with more foreclosures, Dubuque's housing market is pretty sound.

The state attorney general is part of a national foreclosure prevention group. Just last week, they reported six out of ten people behind on their home loans are not getting assistance to avoid foreclosure.

Here in Iowa, if you need help, you can call the state's free mortgage help hotline. The number is 1-877-622-4866.

Online reporter:  Jamie Grey

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