To address the growing shortage of legal aid services, advocates have appealed for reforms at the state and federal level to allow expanded legal services to homeowners who cannot afford to hire lawyers of their own.

And it seems that the proposal is gaining some support in Maryland. Already, Governor Martin O’Malley has introduced a legislation that makes mediation mandatory. This means that all mortgage lenders will be required to participate in negotiations that would result to affordable loan terms for distressed homeowners and make foreclosure the last resort.

Aside from making it mandatory for all bank foreclosure cases to go through mediation first, O’Malley also wants mortgage lenders to pay for all the costs related to the case. For the first nine months of this year, the number of households in Anne Arundel County that received at least one foreclosure filing reached an all time high compared with same period last year.

Market data showed that in September, there were 276 repossession cases, a slight drop from the previous month’s 298 but far higher from the total figures for September of 2008 and 2007. On a year-to-year basis, the total number of foreclosure filings in the county is about 2,300. And industry experts are predicting that the number of foreclosure cases will hit over 3,000 by the end of this year.

Experts said that majority of homeowners who are in some stage of foreclosure proceedings in the county does not have court representation. They added that the trend is logical because if troubled homeowners could not afford to pay their monthly mortgages, it follows that they could not also afford to hire a lawyer to help them.

The Maryland Legal Aid Bureau staff members said that the nonprofit law firm is seeing a 64 percent rise in the number of foreclosure cases that it handled for several months now. Staff members pointed out that there is a growing need for legal services from homeowners facing the threat of bank foreclosure. However, they said that the law firm could only help homeowners who meet certain requirements.

Among these foreclosed properties are four apartment buildings in Broward, namely Royal Sheridan, Palm East Apartments, Normandy Apartments and Heritage Green Apartments. All these apartment complexes were formerly owned and managed by the family of Constantin Ardelean, based on court records.

Of the four foreclosure judgments, the highest was the $6.9 million assessed against the Royal Sheridan, followed by the $5.6 million assessed against the Heritage Greens. Both the Normandy Apartments and the Palm East Apartments were each assessed for $1.7 million.

Sovereign Bank continues to struggle from its bad loans despite help from Spanish bank Banco Santander which acquired it early this year. According to Banco Santander, Sovereign’s nonperforming loans have been rising, accounting for nearly 4 percent of all its loans in the April-June quarter and marking a jump from 3 percent during the first 3 months of the year. For the first 6 months of this year, the bank allocated $742 million for mortgages expected to default and go into its bank foreclosure list.

Another bank hit by multifamily foreclosures in South Florida is Wachovia Bank, the mortgage lender acquired by Wells Fargo in December last year. Wachovia foreclosed on three residential projects called Homestar in the southern part of Miami-Dade, with one at Sunset Cove, the other at Miller Cove and the third at South Dade for failing to pay a total debt of $4.7 million. The original mortgage was last modified in 2006 at $12.8 million.

The Sunset Cove building has 22 units, with seven homes sold by developer Jose Hernandez and his firm. The remaining 15 units and two unsold units at Miller Cove were the ones foreclosed. Construction on the South Dade project was never started.

Wachovia Bank also filed foreclosure actions against Philadelphia-based developer Palm Club Apartments LLC, which acquired the 160-unit Palm Club apartment complex near the Palm Beach Community College campus in Lake Worth in 2004.

The developer also purchased an adjacent lot from the community college and borrowed $8.7 million from Wachovia. The next year, it increased its loan by borrowing another $3.5 million from the bank using the properties as collateral. The properties are expected to go into Wachovia’s bank foreclosure list if the developer fails to come up quickly with the millions to rescue the properties.

The median sales price for single-family homes during the quarter in the Pittsburgh metro area increased by only $400 to $124,600 from $124,200 in the April-June quarter and increased by $1,900 from $122,700 in the July-September quarter last year.

The median sales price for all types of homes sold in 2008 was $118,400 while it was $120,700 in 2007 and was $116,100 in 2006.

During the quarter, the median sales price for previously owned single-family homes in 123 metropolitan areas in the U.S. decreased compared to the median during the same quarter in 2008. In 30 of the metro areas, the median sales price increased.

The median sales price nationwide for single-family homes in the July-September quarter dropped by more than 11 percent to $177,900, compared to the same quarter in 2008. Foreclosure sales and short sales, which comprised 30 percent of all residential sales, pushed down sales prices for non-distressed properties.

Based on a foreclosure report released by a real estate research company, the number of Pittsburgh foreclosures for sale in the residential sector dropped in the July-September quarter. A total of 2,671 residential properties in the Pittsburgh metro area received foreclosure actions, representing 0.24 percent of all residential units in the area.

The pace of foreclosure activity decreased by more than 20 percent compared to the same quarter in 2008 and by nearly 18 percent from the April-June quarter. Housing analysts contended that the relatively strong economic conditions of Pittsburgh and its foreclosure prevention programs were able to curb the increase in foreclosures in the area.

Additionally, the intensified efforts of federal agencies to implement the Home Affordable Modification Program have apparently been effective in curtailing the flow of troubled mortgages into foreclosure.

According to NAR chief economist Lawrence Yun, foreclosure properties are expected to occur in many markets, but the expansion and extension of the federal tax credit for first time buyers will help increase home sales, stabilize home prices, reduce the number of borrowers with negative equity and help stem foreclosures.

Yun said that sales of previously owned homes continued to rise in most states largely because of the tax credit, with the nationwide home sales increasing by more than 11 percent to an annualized pace of 5.3 million residential units in the July-September quarter.

Hotels continued to struggle as travelers reduce their discretionary spending, resulting to sharp decline in hotel revenues. And to make matters worse, hotel values dropped so drastically that a growing number of properties are at risk of foreclosure as owners failed to meet their mortgage payments.

In San Diego, California, the number of hotels facing foreclosure threat increased almost four times in the first eight months of this year. And industry analysts are predicting that more hotels will face the bank foreclosure listings before the year ends.

The current trend is benefiting bargain-hunting travelers who will encounter many room rate discounts as a way for hotels to entice more customers in order to survive the current market battered by the economic downturn and high unemployment.

Some local hoteliers are concerned that with many hotel owners walking away from their properties, they will be left competing with hotels owned by lenders who will sold the properties way below the market value.

Industry experts are expecting a very stiff competition among people who want to buy cheap hotels and then operate them at cutthroat rates. This will greatly affect hotel owners who are charging at full price. However, they believe that the market is nearing its bottom and will see some strong improvement in terms of demand by third quarter next year.

Recent market data showed a drastic increase in the number of delinquent hotels, from 6 in January to 26 last month. Meanwhile, hotels that went into foreclosures jumped two times from 2 to 4. These foreclosed hotels include the El Camino Motel, Harbor House, Pacific Coast Inn and Suites and Mount Woodson Golf Resort.

Some of the delinquent hotel properties included the Extended Stay America, Mission Plaza Hotel and Suites and Homestead Studio Suites.

Industry experts predicted that more hotels will go into foreclosures which would result in spiraling prices and more bargains for consumers.

So far, statewide data showed that 260 hotel owners were in default while 47 were on bank foreclosure listings.

The town of Benson applied for the CDBG funding in the fall of last year and received approval in the spring. A local match of $85,000 will be added to the CDBG funds, bringing the total amount of funds to $855,000 which will be used by the town to revitalize the Hall and East Branch streets area.

The CDBG program was launched by the HUD in 1974 to provide funds to communities to help them improve neighborhoods blighted by the growing number of bank foreclosure homes. According to town officials, the CDBG funds will be spent to rehabilitate 12 houses, demolish three houses, pave streets and upgrade sewer lines in selected areas. They said that the grant will benefit mostly property owners with low and moderate income.

The community revitalization project is slated to start in about a month’s time and expected to be completed in eight months. Officials explained that they wanted to address neighborhoods that have been identified to have sewer problems, to initiate redevelopment and stabilize neighborhoods.

The grant will greatly help owners of single-family homes. Town officials intend to expand the program and are planning to request members of the town planning board to provide recommendations for areas to be helped by the program.

The Wooten Co. of Raleigh has helped the town government identify the first 12 houses that will receive assistance. Representatives of the company said that they identified areas that have in great need of housing rehabilitation, adding that many of these properties belong to low-income and moderate-income owners.

Landlords or homeowners of the properties identified in the program are not expected to repay the CDBG funds provided that they do not sell the rehabilitated homes. If they sell the renovated houses, owners are required to repay the money spent on the house to the town of Benson which will then turn over the payment to the HUD.

Industry experts agree that federal programs providing grants to neighborhoods blighted by bank foreclosure homes are a great way to reduce the number of foreclosure properties that have glutted the housing market for some time now.

Among these is the sale of the foreclosed La Mesa Village apartment complex in Mesa to Los Angeles-based Ennabe Properties for $5 million. According to Marcus & Millichap executive Alon Shnitzer, Ennabe beat out 21 other prospective buyers because Ennabe proved its capability to pay in cash and close quickly.

Shnitzer explained further that Ennabe paid a low price because the 256-unit property had a low occupancy rate and a negative cash flow. The multifamily building was formerly owned by another Los Angeles real estate firm, SRS Properties. Because of the falling occupancy rate and the troubled cash flow, SRS failed to pay its loans and ultimately fell into foreclosure early this year.

Nancy Ennabe said that the property can become profitable with upgrades. She added that her company is looking for other Phoenix foreclosures for sale, including non-distressed multifamily properties with strong profit potentials.

Based on data from Colliers International, vacancies in the industrial and commercial sectors in the Phoenix metro area rose by 17.5 percent in the July-September quarter because of the high unemployment rate, lack of available credit and lack of business tenants.

CB Richard also affirmed the Colliers finding, but its vacancy rate report shows a lower rate at 15.8 percent, an increase from 15.2 percent in the previous quarter and a substantial increase from 12.1 percent in the July-September quarter in 2008.

The biggest drops in average lease rates occurred in the northeast part of the Phoenix metro area and the lowest drops occurred in the southwest portions. The vacancies have pushed down industrial construction from 5.8 million square feet of space in last year’s third quarter to only 1.2 million in the July-September quarter.

However, sales of non-distressed commercial buildings in the Phoenix metro area stepped up. Among these was the sale of the 316-unit Crossroads multifamily complex at the Deer Valley area in Phoenix by AIMCO to Olympus Properties for $31,200 per apartment unit or a total of $9.85 million. The complex was constructed in 1982.

Another was the sale of 72 condo units at the Mark condo complex in Scottsdale by Toll Brothers Arizona to Silverman Companies, which plans to reposition the project and resell the condo units.

In October, banks have started foreclosure proceedings on 2,152 residential properties in Orange, down by more than 3 percent from proceedings in September but up by an overwhelming 133 percent from filings in October 2008.

The number of delinquencies also dropped, marking the third consecutive month that defaults fell in the county. The decrease could have been the result of the intensified efforts of federal agencies to pressure mortgage lenders and servicers to modify loans. According to the latest report from the Making Home Affordable Program, it has modified about one-fifth of all qualified home loans nationwide that were in default by at least 2 months.

In October, the total number of Orange County homes and condo units foreclosed and repossessed by banks climbed up to 763 units, an increase of nearly 8 percent from September and by 3.5 percent from October 2008.

Over the past three months, foreclosure activity slowed in Orange County, so analysts are still uncertain about how to interpret the rise in foreclosures in October in the county. But investors planning to buy bank homes have an additional 763 units to choose from.

Besides, many housing analysts still expect another uptick in foreclosures in the coming months because of the high unemployment rate in California, the resetting of adjustable mortgage loans and the redefault of modified loans.

The unemployment rate in Orange County in September was still high at 9.4 percent, despite its drop from 9.8 percent in August. Statewide, the jobless rate was 12 percent, based on data from the California Employment Development Department.

Meanwhile, both home sales and prices climbed up in October in 25 zip codes in Orange County while home prices increased in 40 zip codes by nearly 4 percent compared to October 2008.

Throughout the county, a total of 3,082 residential units were sold in October, marking an increase of more than 9 percent compared to sales in October last year. The October median sales price of $435,000 was 18 percent above the lowest median in 2009, which was the January median of $370,000.

But sales prices for single-family homes were still selling for 33 percent below their 2007 peak while condo units were still selling for 34 percent below their 2006 peak.

Investors planning to buy bank homes in Orange County have great profit prospects because of the positive trend of home prices in the county.

According to a foreclosure report from a California-based real estate research company, 0.42 percent of residential units in the Philadelphia metro area were in foreclosure in October, much below the foreclosure-battered cities, such as Phoenix, where 2.43 percent were in foreclosure, and Las Vegas, where 5.13 percent were in foreclosure.

Statewide, foreclosure activity grew slightly by 0.93 percent from September and by nearly 39 percent from October last year, but compared to other states, Pennsylvania was performing better as it was 34th on the ranking of states based on foreclosure rates.

A total of 5,545 residential units in Pennsylvania were notified of delinquency or foreclosure, with more than 1,200 units already repossessed by banks. One unit out of every 988 housing units in Pennsylvania received a default or foreclosure notice.

According to analysts, the major causes of foreclosures, namely unemployment, negative equity and high-risk mortgage loans, are still expected to push many distressed homeowners into default.

In the coming months, more Philadelphia foreclosures for sale are expected, according to reports from local banks. As of the end of September, the percentage of problem construction and other mortgage loans in the 15 biggest banks in the city has risen to almost 3 percent, far above the 0.89 percent in September last year.

The 15 banks have about $1.1 billion in problem loans, which they have to remedy through restructuring, extension, foreclosure or other means.

To help these struggling banks in Philadelphia, the Federal Reserve kept its federal funds rates low at zero to 0.25 percent so the banks can borrow at very low costs and then earn from the fewer loans they have been making.

Kent Lufkin, head of TF Financial Corporation, said that banks now need to keep an eye on their reserves and their lending practices. He added that his bank has been able to keep nonperforming loans at a low level because of his bank’s strict lending practices.

In contrast, Abington Bancorp lent aggressively to the residential construction sector and now has the highest percentage of bad loans in the region. Among the buildings that it had repossessed recently was the American Loft, which it took back in June at a foreclosure sale for $8.6 million.

When you buy a property from an online foreclosure auction, the auctioneer gives you time to research the properties, including time to physically inspect the properties, although all these activities have schedules and time frames.

In a foreclosure auction conducted in a building where bidders are physically present, participants are also given time to inspect the properties, although in most cases, properties auctioned off by courts can only be inspected from outside.

Both online and conventional foreclosure auctions sell properties on an as-is basis. Some auctioneers also ask buyers to sign waivers of the ten-day post-auction inspection period described under Title X, which gives winning bidders the right to inspect the house for lead-based paint.

In most cases, companies holding both types of foreclosure auctions also provide information on the foreclosure properties to be auctioned off on their web sites. But companies holding purely online foreclosure auctions provide more detailed information and more photographs as they are targeting buyers that rely mostly on information available online. Prospective buyers can look at a lot of properties online before choosing certain properties that they like to inspect physically.

What sets the two ways of buying foreclosure auction properties apart is the bidding environment. When bidding online, you are in the privacy of your home or your office, allowing you to focus on your notes and on the process of bidding without the grumblings, mutterings and tension common in a conventional auction.

In a conventional auction, there is also the risk that you can get hyped up by the intensity of the bidding that you lose sight of the fact that you are already bidding more than the real value of the foreclosed property.

When considering bidding online, check the reputation of the auctioning company. Avoid participating in newly launched auction firms that have not shown concrete proofs of their intentions in the real estate sector.

Remember that you are giving your credit card number for verification and deposit purposes, so you should only trust companies that have been successful in the real estate auction business for a long time.

Additionally, read the Contract for Sale of Real Property and the Auction Terms and Conditions thoroughly before registering for online bidding. Reputable auction companies provide clear and detailed instructions on buying foreclosure auction properties online to protect not only themselves but also buyers.

Goldman sold a total of 158 foreclosed condo units in its Kendall project called Downtown Dadeland for only $113,000 each, equivalent to just 33 percent of the cost of construction and the land. The units are part of a seven-building residential and commercial complex in Kendall, which is about six miles from downtown Miami.

According to Peter Zalewski, founder of Bal Harbour-based property brokerage Condo Vultures LLC which reported the condo sale on its website, Goldman took a big price cut from the sale.

The fortunate buyer was a partnership created by Nova Scotia-based Southwest Properties Limited and Armco Capital, which made a cash payment of only $17.9 million for the condo units. The payment is equivalent to around $109 per square foot, substantially below the estimated building costs of around $300 per square foot, based on computations made by Jim Spatz, chief executive of Southwest Properties, and by Condo Vultures owner Zalewski.

The deeply discounted foreclosed homes sale is nonetheless not a rarity in the Miami area, where average condo prices have fallen by 37 percent over the past year to only $137,900 in the July-September quarter.

Based on a report released by the Florida Association of Realtors, sales of condo units have increased by 43 percent to almost 1,800 units during the quarter because of the sharply discounted prices. In September, the median prices for new and pre-owned houses and condo units dropped to $159,000, marking a 30-percent drop from the median in September last year.

The Downtown Dadeland, which had its groundbreaking in 2003, was sold at a low price despite its being next to the popular Dadeland Mall, which is operated by Simon Property and which is anchored by the biggest Macy’s store in South Florida.

The condo units range from studio units to three-bedroom units measuring 1,100 square feet on average. According to Spatz of Southwest Properties, the partnership will rent out the condo units for about 3 to 5 years until condo prices in Miami improve.

Goldman Sachs disposed of only the condo portion of the Dadeland development in the foreclosed homes sale. It still owns the commercial portion of the complex. According to Zalewski, the complex was built at a cost of $224 million and Goldman Sachs acquired it through foreclosure.