Stockton Bank Foreclosures Continue to Attract Attention

by Peter Vernon on cities

Stockton bank foreclosures continue to attract public attention nationwide not only because of the image of Stockton as epicenter of the first wave of foreclosures but also because of its continued high ranking in charts of mortgage defaults and foreclosure rates.

In the first 6 months of this year, Stockton still occupied fifth place in a ranking of metro areas clobbered by high rates of foreclosures. Nearly 13,000 households received default or foreclosure notices from January to June, indicating that nearly 6 percent of all households in Stockton are in the foreclosure process.

Stockton’s foreclosure rate of one in every 18 households in the first 6 months of the year was slightly lower than its rate in the previous quarter, but Stockton continues to be battered by unemployment and poverty problems that arose from the flood of foreclosures that swept the whole San Joaquin Valley.

According to a recent study of 100 metro areas by Brookings Institution, 4 of the 5 metro areas with the highest unemployment rates in June are all San Joaquin Valley metro areas, and Stockton is one of them.

The same study also found that Stockton had the highest increase in poverty rate among metro areas, pushing more housing units into lists of Stockton bank foreclosures. The poverty rate rose to 16.8 percent in Stockton, up from 14.1 percent.

The other metro area most affected by poverty is the Lakeland-Winter Haven area in Florida, where the poverty rate rose to 15.4 percent from its previous rate of 12.7 percent. The Florida metro areas of Tampa-Saint Petersburg, Bradenton, Orlando and Palm Bay also experienced increases in poverty rates.

Because of the economic challenges being faced by Stockton, Stockton has been the tenth stop of the Obama administration’s nationwide Making Home Affordable Program campaign in September.

Officials from the U.S. Treasury Department and the Housing and Urban Development and representatives from Wells Fargo-Wachovia, American Home Mortgage Servicing, GMAC, Ocwen, Indymac Mortgage Services, Chase and Bank of America held a workshop to help families facing foreclosure.

The workshop aimed to reduce monthly loan payments to 31 percent of their monthly income. Troubled homeowners who were able to bring complete documents that include loan papers, tax returns, paycheck stubs, car loan papers and other financial documents were able to get help.

Still, many distressed Stockton homeowners have chosen to walk away, according to the California Mortgage Bankers Association.