Lenders have seized nearly twice as many homes on the North Olympic Peninsula this year than they did in first three quarters of 2009 — but foreclosure activity remains lower here than the state and national average.
A total of 176 foreclosed homes in Clallam and Jefferson counties have been repossessed this year compared with 100 for the first nine months of 2009.
Clallam County’s rose from 89 to 129 while Jefferson County’s spiked from 11 to 47 in the first nine months of this year.
Thirty-six foreclosed properties were seized on the Peninsula in September, compared to 15 in July, according to Realty ÂTrac, a national foreclosure listing service.
“We think we’re kind of in the middle of this foreclosure cycle, maybe just past the halfway point,” said Daren Blomquist, RealtyTrac spokesman, in Irvine, Calif.
“We’re going to have a couple more years of high foreclosure levels.”
Overall, Washington ranks No. 14 in foreclosure activity.
The Seattle-Tacoma-Bellevue metro area showed the largest annual increase, but it hasn’t hit the North Olympic Peninsula as bad.
One in every 736 Clallam County housing units, or 0.13 percent, received a foreclosure filing in September. A foreclosure filing is the first step in the foreclosure process.
In Jefferson County, one in every 808 homes, or 0.11 percent, received a filing last month, RealtyTrac reported.
That compares well with the state (0.20 percent) and the national (0.27 percent) average.
The foreclosure process begins with the default notice — the initial notice sent to a homeowner in default.
The next step is the notice of trustee sale, or auction notice, scheduling a public auction of a foreclosure property if the owner does not pay what is owed during the default period.
The final step is the REO.
Real estate owned, or REO, is a foreclosed home that a bank repossesses, usually after the home fails to sell during a trustee sale.
If a third party does not purchase a foreclosed property in a public auction, then it is repossessed by the foreclosing lender, Blomquist said.
“A lot of times, when you want a measurement of how many homes are lost to foreclosure, that’s the best way to look at it,” Blomquist said.
Terry Roth, a third-party Clallam County auctioneer, said foreclosures are up “at least 25 percent” this year.
“On Fridays at the courthouse, last year I was doing anywhere from 8 to 12,” Roth said.
“This year it’s closer to an average of 16. Three weeks ago I had 25.”
“I’ve done this for 20 years as a private auctioneer and it’s the most that I have ever seen.”
Roth said the Peninsula’s foreclosure situation mirrors the rest of the nation.
“This is an industry-wide problem,” he said.
“It’s a sign of our economic situation.”
Roth holds his auctions each on Friday’s beginning at 10 a.m. at the Clallam County Courthouse.
President of Peninsula Process Service Mari Fahey is Roth’s counterpart in Jefferson County. She also holds her auctions on Friday at 10 a.m. at the Jefferson County Courthouse.
Like Roth, Fahey said foreclosures “are definitely up” this year.
“But it’s hard to tell [the number] because they just keep getting postponed,” Fahey said.
“There’s more than last year, but there’s also more postponement. Basically we’re doing the same sale again.”
Foreclosure sales can be cancelled or delayed if home owners show that they are working with the lenders to pay the mortgages.
Fahey counted 170 trustee sales in Jefferson County this year.
“But those weren’t new sales,” Fahey said.
“Those were all kinds of sales — sales that postponed, sales that cancelled — everything. Of those, I had a total of 53 that actually had an opening bid and no one bid on them. So they what we call reverted. They went back to the mortgage holder, the bank.”
Fahey said she sold just one property to a third party at auction this year, in January.
“That was actually to some people that were renting it and just bought it,” she said.
In the vast majority of the properties that Roth takes to auction, more money is owed on the property than it is worth.
“That’s because property values against mortgages are upside down,” Roth said.
Nationally, 290,356 properties were lost to foreclosure from July to September.
That’s an increase from 271,734 in the second quarter, which was the previous quarterly high in RealtyTrac’s five-year database.
Meanwhile, attorneys general in all 50 states launched a joint investigation Oct. 13 into fraudulent foreclosure practices by banks and mortgage services.
“Unfortunately, people lose homes during an economic downturn,” Washington state Attorney General Rob McKenna said in a prepared statement.
“But they have the expectation that if they are subject to a foreclosure, it will be done legally. That’s what this investigation is about.”
Roth said the investigation may “slow the procedure up.”
He predicted that the new rules will affect other states more so than Washington.
“Our rules are pretty protective of the borrower and the lender,” Roth said.
“They’re not quite like some of the other states. I don’t think we’re going to seeing the fraud issue that’s been raised in other states.”
Overall, Roth said “the system’s on overload.”
“You can call the trustees listed 30 times and you might talk to real person once,” Roth said.
“They’re just swamped. Absolutely swamped. These people are tearing their hair out. WaMu [Washington Mutual] all by itself was a major disaster.”
Staff was cut after WaMu was absorbed by JPMorgan Chase, Roth said, and “the workload was still there.”
On Friday, Roth auctioned three properties back to the beneficiary trustee, or lender. The rest of the properties were postponed for future auctions.
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Reporter Rob Ollikainen can be reached at 360-417-3537 or at rob.ollikainen@peninsuladailynews.com.
