Joshua Deknoblough

Foreclosure filings in Shasta County increased 32% compared to the previous month. There were 78 notices of default filed with the Shasta County Recorder’s office in the month of October, compared to September’s low of 59.

When we compared this month last year we saw 22% fewer filings. In October 2007 there were 95 notices of default filed and we only had 78 in October of 2008.

Last month we speculated that the cause for the major drop from Augusts high of 206 foreclosure notices was due to State Senate Bill 1137. SB 1137 forces banks to take certain steps before filing foreclosure. We expected a bigger jump in default notices this month as lenders get back on track from the delays caused by SB 1137, but it appears the bill is having a lasting effect and is working.

Earlier this month Countrywide, Bank of America, JPMorgan Chase, and now Citi, revealed plans to keep homeowners in their homes by doing major loan modifications, these programs are scheduled to start in December. Loan modifications in the past have not been that effective; however the banks are starting to realize this and are making significant drops in principal and interest for qualified homeowners. We feel this will have an effect and the foreclosure filings will flatten out over the next few months and start to decline in the first quarter of next year.

With the changes in the credit market and the new FHA guidelines 100% financing is almost impossible to find. I say almost because there are a few programs still available. One of them is the U.S.D.A. Rural Development Program. The U.S.D.A. Rural Development Program is a government backed loan that allows homebuyers in qualified areas to get up to 102% financing. Some of the other benefits include:

· No mortgage Insurance

· No maximum purchase limit

· Home repairs can be included in the loan

· No minimum credit score

· Flexible income limits

Like all government programs there are restrictions, and the major restriction on this program is the areas that are eligible.

There are several areas in Shasta County that qualify, U.S.D.A has a map that shows the areas that are eligible, all you have to do is type in the property address and it will tell you if the property qualifies or not. Here is a link to the U.S.D.A Rural Development site:

http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp&NavKey=property@11

Don't forget Saturday night is the City of Redding's Freedom Festival. The fireworks show that is normally scheduled for July 4th was postponed this year because of the fires. It will be held outside on the Redding Convention Center grounds. Admission is free and there will be venders, food and live music.

Event Contact: 530-225-4100

Also this weekend:

The Return of the Salmon Festival at the Coleman Fish Hatchery.
Event Details http://www.visitredding.com/eventDetails.cfm?eventID=1265

The Fall Festival in Palo Cedro.
Event Details http://www.visitredding.com/eventDetails.cfm?eventID=1270

Foreclosure filings in Shasta County dropped significantly compared to the previous month. There were only 59 Notices of Default filed compared the previous months number of 206.

When we compared this month last year we saw a 34% fewer filings. September 2007 there were 89 notices of default file and only 59 in September 2008.

This significant drop could be a result of lenders being more motivated to work with borrowers and resolving the loan delinquency before it gets to foreclosure. This could be a good sign however we are expecting next month’s number to be well above a hundred but below Augusts high of 206.