Local Foreclosure Counseling Agency “Overwhelmed”

KING 5 reports that the increase in foreclosures is putting stress on one local non-profit that offers assistance to distressed mortgage owners.

For homeowners caught up in the mortgage meltdown, finding help to save their homes is getting tougher. A Seattle non-profit group helps those facing foreclosure, but the small office is overwhelmed.

The non-profit agency called Solid Ground helps navigate the ins and outs of the complicated process and how to hopefully save your house. But with a 50 percent increase in calls and cuts in funding, the program is also facing hard times.

“Last week we had about 55 calls and we’re on track to have the same number this week. It’s way more than we can handle,” said Erin Reardon, mortgage counselor.

Wow, that sounds really… familiar.

Maybe it’s because KING 5 did basically this exact same story less than two months ago.

Housing advocates and lending counselors say they’re being overwhelmed with calls for help from desperate Seattle-area homeowners, many on the brink of foreclosure.

Solid Ground, which helps low income families, says it’s getting more than 50 calls a week from Western Washington homeowners who are having trouble paying their mortgages.

Foreclosures are definitely on the rise here in the Seattle area, but things probably aren’t as dire as KING 5 is making it sound with this re-run report.

Compared to San Diego, where prices have been falling for two and a half years and they’ve been seeing over 3,000 Notice of Defaults every month lately, the 1,000 monthly foreclosures we’ve had in King/Snohomish don’t look like much of a crisis yet.

(Roberta Romero, KING 5, 12.17.2008)

0.00 avg. rating (0% score) - 0 votes

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

24 comments:

  1. 1
    Slumlord says:

    As prices drop, we will eventually see the similar rates of foreclosure as are currently taking place in San Diego, Puget Sound is just not as far along in the process. I am sympathetic for most people facing foreclosure, but I need to vent about an exception. An acquaintance came to me for advice because she and her husband are behind on payments for their two rental properties. This is after a 3-week family vacation to Hawaii. They would rather see their tenants evicted than cut back on family expenses such as shopping, private schools, and leisure travel. These people disgust me and the only reason I did not say so to their face is that we travel in the same social circles. Perhaps next time I will find my backbone and say what I think.

  2. 2
    The Tim says:

    That is disgusting. Sadly, it’s an all-too-common product of our spend-happy, consumer credit culture.

  3. 3
    jonness says:

    “Compared to San Diego, where prices have been falling for two and a half years and they’ve been seeing over 3,000 Notice of Defaults every month lately, the 1,000 monthly foreclosures we’ve had in King/Snohomish don’t look like much of a crisis yet.”

    “Yet” appears to be the key word. San Diego was at an identical point on the graph at the same point into the drop that Seattle is now seeing. If Seattle winds up doing a full retrace of San Diego, it’s going to be ugly. I didn’t think it would happen because Seattle didn’t run up as high. However, the current state of the economy puts tremendous downward pressure on Seattle house prices that isn’t going away soon. The situation continues to be interesting.

    Seattle vs. San Diego

  4. 4

    HEY KING 5, “WHAT HAVE YOU BEEN SMOKING?”

    San Diego has 5 times the population of Seattle, therefore our 1000 a month is 5000 a month in comparison. Seattle is FAR worse than San Diego.

    But you news reporters could care less about simple math logic?

  5. 5
    Agent says:

    “San Diego has 5 times the population…”

    Seattle Tacoma Everett area has population of about 3.4 Million
    San Diego Metro area about 2.8 Million

  6. 6
    The Tim says:

    softwareengineer,

    KING 5 didn’t make any comparisons to San Diego, only I did. And San Diego County has a population of 2.97 million, compared to the King + Snohomish population of 2.47 million. They’re relatively comparable in terms of population.

  7. 7
    DrShort says:

    in other news: Zillow lays off 25% of workforce

    http://www.techcrunch.com/2008/10/17/25-layoffs-at-seattles-zillow/

  8. 8
    cheapseats says:

    http://blog.seattlepi.nwsource.com/realestate/

    On Oct 13, seemed to take exception to an unnamed bubble blogs comparison of the Seattle / San Diego chart, guess they ignored the entertainment purposes only portion…

  9. 9

    I STAND CORRECTED TIM (THANK YOU)

    Hey, did you read the home mortgage interest rate spikes in the last weeks on Bankrate?

    they’re talking 7% in a few weeks…..

    see the proof:

    http://news.yahoo.com/s/time/20081017/us_time/thebankbailoutssideeffectrisingmortgagecosts

    Now, since the bailouts caused the horrifying interest rate spikes and home prices should collapse faster in Seattle with the bailouts…..wouldn’t you say foreclosures are just the tip of the iceberg right now in Seattle?

    How in Hades will Seattle area’s distressed homeowners sellout in time?

  10. 10
    patient says:

    Do we have ~1000 foreclosures each month in King/Snohomish!? I had no idea it
    was that many. I don’t follow foreclosures at all so I would have guessed about a 100. Sounds like the foreclosure rate and the closed sales rate could meet in the not so distant future.

  11. 11
  12. 12
    patient says:

    Some US census data:

    Housing units (2006)
    King: 803 000
    Snohomish: 270 000

    Homeownership % (2000)
    King: 60%
    Snohomish: 67%

    My calculations:
    Owned units if ownership % stayed similar:
    King: 803 000 x 0.6 ~ 480k
    Snohomish: 270 000 x 0.67 ~ 180k

    King + Snoho = 480k + 180k = 660k

    This would give a yearly foreclosure rate of ( 1000 x 12 ) / 660 000 ~ 1.8% or 1 foreclosure for every 55th home…that sounds brutal.

    Understanding that the numbers are outdated and not perfectly accurate.

  13. 13
    patient says:

    I’m not sure if the census data is owner occupied homes or total number of housing units counting rentals as well. If it is just owner occupied the rate would be 1.1% or ~ 1 in 90 homes. Still sounds teribly high.

  14. 14
    pfft says:

    swamped foreclosure counseling agencies? I though Seattle was different?

  15. 15
    victorchai says:

    dam..n media…

  16. 16
    patient says:

    Or “chocolatey” media. Hey Tim the profanity filter doesn’t work in the recent comment part….

  17. 17
    Ben says:

    Slumlord,

    I would agree that it sucks to be in a family that has to leave a rental because the landlord could not deal with their finances effectively. But at the end of the day, that is the risk of renting. With renting you lose some control over your circumstances.

    I don’t think that landlords have a moral obligation to put the mortgage of their investments above their own happiness, and I think that creating a legal obligation here would be damaging as well.

    I hear people boasting about living in a place where the rent would not cover half of the mortgage. That is all well and good, and I don’t think that you should pay more, but you should be prepared to perhaps have to move one day because of this.

  18. 18
    patient says:

    Ben, I think what most of us in that situation are saying is that we are paying half or less what the monthly mortage cost would be from current appraised value. Not that our landlords are taking a 50% loss every month since in my example the owner bought the house new in the early 90s and with that cost basis he is most likely making a profit. On the other hand as a renter you are always prepared to leave at the end of the current lease.

  19. 19
    Ben says:

    Patient,

    I understand that is where many deals come from. But some of those landlords were ATMing the money out of these properties during the boom, and many people who bought at the top are starting to rent out now.

    I think that a great tutorial for this site would be to show people how to find out what is owed on a property from records. That would let a prospective renter get an idea of what the cash flow is for their landlord, and avoid an unstable rental.

  20. 20
    patient says:

    Good advice Ben.

  21. 21
    mark says:

    Softwarengineer,

    Where do you get the stats that you post? You come up with some pretty wild stuff. Wasn’t to long ago that you said that Seattles population had shot up something like 80% in the past ten years.

    Maybe you’re right though, the census might not be counting all of those illegals that you keep warning about. San Diego could very well be 5 times larger than Seattle with all of those shadow citizens. Seattle could also be significantly larger than any of us realise with all of our invisible citizens.

  22. 22
    Jillayne says:

    I’ve said this before and I’ll say it again. Our state just gave the housing counseling agencies 1.5 million dollars out of the state rainy day fund to help combat rising foreclosures.

    I’d like to see an investigative journalist report on exactly how that money is being spent. If the agencies are overwhelmed after receiving that much, what will happen if we give them another 1.5 mil?

    I’d like a recap on how the money is being spent. How much is going towards high executive salaries and how much is going to hire and train competent, people?

    The non-profits could hire grad school interns to get their counseling hours under their belt before taking the state exams.

    The non-profits could hire out of work mortgage production people (not LOs) and they would be able to get up to speed very fast.

    On the up side, I’m very happy to hear that so many people are visiting the agencies. The social services are in place and it’s great to hear that they are being used.

    It’s more sad when you hear the stories about people who do nothing and then ask for help when it’s too late.

  23. 23
    Softwarengineer says:

    HI MARK, NICE TAKE

    I got the 80% increase in Seattle population using an Olympia growth % since 1990 I believe I heard from Ken Shram’s radio show….I assumed Olympia and Seattle had about the same growth. You’re right, undocumeneted immigrants and chain migration (old age relatives) could spark the Seattle population 80% though. Its undocumented, you need a Ouiji Board to do a count….

    As far as wild numbers, hey, my predictions make Paulson’s bailout predictions for a better economy look like a laughing stock….lol

  24. 24

    […] State when Gov. Gregoire signed SB 6272 State agencies saying are already whining that they are “overwhelmed” until as a taxpayer, the agencies show us exactly HOW the 1.5 million dollars was spent. Do NOT […]

Leave a Reply

Use your email address to sign up with Gravatar for a custom avatar.
Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Please read the rules before posting a comment.