Mortgage Defaults Rising, According to the LA Times
Foreclosures have risen 215% in California, according to DataQuick Information Systems, La Jolla (cited in David Streitfield's article at the LA times, 8/3/06, "Mortgage Default Notices Soar 67%.") The figure is a bit misleading, because although there have been 1,901 foreclosures in the state during the second quarter, this is historically and statistically quite low.
[Thanks to pplv.com for the image.]
Default notices, the first stage of a foreclosure, have come in at about 20,000 during the second quarter of 2006. The quarterly average is 30,000. High is 60,000 in 1996, low is 12,000 during the 3rd quarter of 2004.
On the one hand, you have Scott Simon of Pimco, Newport Beach, saying, "by every historical standard, this [level of defaults and foreclosures] is still insanely low." He rates the current level at 1 out of 10.
On the other, you have Angelo Mozilo of Countrywide Financial Corp., saying, "I've never seen a soft landing in 53 years."
I tend to believe Mozilo, although it may take longer than we expect, and will depend on what the Fed, the mortgage rates, commodity prices and political unrest do in August and thereafter.
[Thanks to pplv.com for the image.]
Default notices, the first stage of a foreclosure, have come in at about 20,000 during the second quarter of 2006. The quarterly average is 30,000. High is 60,000 in 1996, low is 12,000 during the 3rd quarter of 2004.
On the one hand, you have Scott Simon of Pimco, Newport Beach, saying, "by every historical standard, this [level of defaults and foreclosures] is still insanely low." He rates the current level at 1 out of 10.
On the other, you have Angelo Mozilo of Countrywide Financial Corp., saying, "I've never seen a soft landing in 53 years."
I tend to believe Mozilo, although it may take longer than we expect, and will depend on what the Fed, the mortgage rates, commodity prices and political unrest do in August and thereafter.
posted by Katy Delay at 4:26 PM
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