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2nd wave of foreclosures may have started
Thursday, July 14, 2011 - For months, experts have predicted that a second wave of
foreclosures would hit Tampa Bay and the rest of Florida. Now, it appears they were
right.
Initial foreclosure notices in June jumped nearly 61 percent over the previous
month in the bay area and 24 percent statewide, according to a RealtyTrac report
released today. Lenders delivered initial notices to 3,390 homeowners around Tampa
Bay and 23,769 in Florida.
Putting the best face on those dismaying numbers, the June foreclosure figures for
the bay area are still down nearly 50 percent compared to June 2010.
Filings in many other Florida regions also climbed last month. Sarasota-Bradenton
jumped 34 percent; Miami-Fort Lauderdale, 14 percent; Orlando, 34 percent; and
Ocala, 45 percent, the report said. The filings for those areas are also lower than
June 2010.
Scott Brown, chief economist with Raymond James in St. Petersburg, cautioned not
to put too much weight into figures for one month.
But "it's not a good sign," he said. "The worst is still behind us. It's going to be
years before a full recovery."
Before June, filings had dropped in six of seven months.
The talk of a second wave of Florida foreclosures increased in the fall when three
huge law firms collapsed amid allegations of sloppy and fraudulent documentation,
stalling thousands of cases.
Experts said that, combined with the shadow inventory — homes for which
mortgages are 90 days late and nearing foreclosure — would trigger a second wave
of filings and depress the housing market even more.
James J. Saccacio, chief executive officer of RealtyTrac, estimates that 1 million
foreclosure actions should have taken place this year but will be pushed back to
2012. He blamed the increased filings on the paperwork delays in courthouses.
"This casts an ominous shadow over the housing market, where recovery is unlikely
to happen until the current and forthcoming inventory of distressed properties can
be whittled down to a manageable number," he said.
Matthew Weidner, a St. Petersburg lawyer who focuses on foreclosures, doesn't see
an end to the doomsday scenario caused by foreclosures. He blames executives at
Wall Street lenders for the increased filings.
"This is a catastrophe being laid upon a crisis," he said. "America is foreclosing
upon ourselves. The federal government is foreclosing on taxpayers to pay rich
bankers. This is madness."
Nationally, initial filings rose nearly 4 percent last month, but represented a
decrease of 29 percent from June 2010.