Foreclosures up 34 percent in 2003

Foreclosures up 34 percent in 2003

Fort Worth-Dallas residential foreclosures
By Andrea Jares
Posted on Fri, Nov. 14, 2003
Star-Telegram Staff Writer


Residential foreclosures rose 34 percent in the Metroplex this year, hitting the highest level since the real estate bust of the late 1980s and early 1990s, said George Roddy Sr., president of the Foreclosure Listing Service.

There were 28,164 homes posted for foreclosure in Tarrant, Dallas, Denton and Collin counties in 2003, including those listed for the Dec. 2 auction, according to figures released Thursday by the Addison-based company. In Tarrant County, 8,740 homes were posted for foreclosure this year, 30.3 percent more than the 6,710 homes posted in 2002.

The pace of foreclosures has picked up in the past few years, Roddy and others said, largely because of a sluggish economy that has left more people unemployed or underemployed.

Foreclosures increased 25 percent from 2001 to 2002 and 30 percent from 2002 to 2003, according to the listing service.

People who lost their jobs early in the economic downturn are finding it harder to hold onto their homes as time passes with no improvement in sight, Roddy said. Some have drained their 401(k) retirement accounts and savings as they attempted to stave off foreclosure but now have run out of options.

"They've borrowed from Uncle Sam or Uncle Fred and they can't borrow any more," Roddy said. "The longer that the job market stays the same -- and there hasn't been much change in it in a positive way the more people are going to be affected."

The rush of new buyers into the housing market in recent years may also be helping to fuel rising foreclosures numbers, credit counselors said. People who stretched financially to take advantage of historically low interest rates sometimes ran into trouble when they were hit by an unexpected job loss, medical crisis or divorce.

"It's all kinds of people. It can happen to anybody," said Monica McDaniel, a counselor at Consumer Credit Counseling Service of North Central Texas in Denton.

She said that almost all of the clients who come to her office seeking help to avoid foreclosure have lost their jobs and are having a hard time finding new ones. The Denton office sees about three people facing foreclosure a week.

Without a job, it is almost impossible for those in debt to work out a payment program with a lender or to even reorganize under Chapter 13 bankruptcy protection, said Kervyn Altaffer, lawyer and manager of the housing division at Legal Aid in Dallas.

In many cases, Altaffer said, by the time people come to terms with their situation and realize that they will need to sell their house, there is not enough time to sell it before it is auctioned.

Roddy said he expects foreclosures to level off in the coming months but not drop.

"We are not looking for any major increase past what we have seen," Roddy said. "Our assumption is that the interest rates are going to be within a point of what they are for the next year."

A significant rise in interest rates combined with little or no job formation could mean more foreclosures, especially among those with adjustable-rate mortgages, Roddy said.

But he added that he is not anticipating that situation will arise in the next six to eight months.

The growing number of foreclosures has drawn increased interest from investors, who are hoping to get a deal on a rental or investment property, said Roddy, whose company publishes a list for investors to use to evaluate foreclosed property.

The average price of homes sold at foreclosure auctions in the Metroplex so far this year has been 69 percent of their assessed value, according to the listing service.

All America Title Services in North Richland Hills also has seen an increase in the number of subscriptions to its monthly foreclosure list.


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Andrea Jares, (817) 685-3851 ajares@star-telegram.com