12/07/08 — Foreclosures in Wayne: It could be worse

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Foreclosures in Wayne: It could be worse

By Catharin Shepard
Published in News on December 7, 2008 2:00 AM

Wayne County rode out a wave of home foreclosures in October and another upward climb might be on the horizon, but Realtors and lenders say the area is in better shape than other parts of the country.

"We do some (foreclosures). Are we doing more than we have in the past? Yes," said Judith McMillen of the Prudential McMillen Real Estate Group.

Twenty-three foreclosed properties are expected to go up for sale on the Goldsboro courthouse steps in December. Many more foreclosure sales originally scheduled for December were postponed due to court intervention.

In September, 32 foreclosure proceedings hearings were scheduled, with 39 planned for October and 17 in November, according to court records. Some of those hearings were cancelled or postponed.

Listing and showing foreclosed properties is a specialty for the agents at Cardinal Point Real Estate.

"We do probably most of what's in Wayne County," Cardinal Point agent Cherry Ngamthonglor said.

Foreclosure is a fact of life no matter what the economy is like, she said.

"It goes in waves. It's always been like that. There have always been foreclosures. There will always be foreclosures," Mrs. Ngamthonglor said.

Of the hundreds of foreclosure hearing notices posted in 2008, the majority concerned relatively recent mortgages -- contracts signed within the past five years -- and most were for more than $70,000. Some were well into the six-figure range.

"We're hearing a lot of foreclosures on more expensive homes," said Jim Blaine, president of the North Carolina State Employees Credit Union.

Part of the problem might be that lenders helped borrowers purchase homes out of their price ranges, Blaine said.

"There does appear to be some inflated appraisal. Some of what is going on is a lender's scandal," he said.

N.C. SECU, a member-owned, non-profit cooperative, holds about 100,000 mortgages and forecloses on an average of 200 per year.

That average has not increased, but Blaine said the number of late payments has gone up in the past few months.

"Delinquency is trending upwards, but ours is normally very low, about half of a percent," he said. "It's still very good compared to the rest of the country."

The rising unemployment rate, nearing 7 percent in Wayne County, might affect the number of local foreclosues in the coming months.

"We are concerned we are seeing unemployment rising," Blaine said. "Folks are going to have more difficulty."

Mrs. Ngamthonglor said many Realtors are now listing properties for banks and financial institutions like Fannie Mae and Freddie Mac that have reclaimed foreclosed homes.

Lenders often take a loss on foreclosed properties, and might be willing to compromise with borrowers to avoid foreclosure proceedings.

It's always best for struggling homeowners to immediately address any inability to make mortgage payments, Mrs. Ngamthonglor said.

"Now more than ever, it's important to call their mortgage company. The most important thing is not to ignore it," she said. "Now more than ever, they are working with the homeowners."

Notification of a foreclosure hearing is only one step in the months-long legal process before the borrower is evicted, the property reclaimed by the lender and ultimately offered for sale. During that time, a homeowner can still take action to avoid losing his house.

Even on the day of a foreclosure sale, the homeowner can ask a judge to postpone the auction to allow him more time to pay off the debt.

For people looking to take advantage of foreclosure auctions, Mrs. Ngamthonglor warned that properties are typically sold as-is, and even now banks are not selling at bargain-basement prices.

Despite the increase in foreclosures, property values in Wayne County have remained stable.

The county did not experience the large increase in valuation that boosted the market in other areas, so "we've not had the dramatic depreciation," Ms. McMillen said.

"I do not feel Goldsboro property values are declining. I feel that this is a wave," Mrs. Ngamthonglor said. "I think that when all is said and done, we'll pick up right where we left off."

Blaine said the state is much better off than many others that have experiencd plummeting property values.

"North Carolina hasn't had a whole lot of that," he said.

There might be a housing market slump in December because of the upcoming changing of the political guard in Washington, D.C., Mrs. Ngamthonglor said.

"I think that right now, everyone's waiting for the other shoe to drop, and that shoe is Obama's," she said. "I think there's going to be a pause in December while everyone waits for the new administration."