The Northern San Joaquin Valley's foreclosure crisis is over. Just-released data show the number of homes lost to mortgage default this spring dropped to 2006 pre-crisis levels.
After 6½ years of mortgage misery, the final counts are in, and they're staggering.
Total homes lost to foreclosures from January 2007 through June 2013, according to DataQuick:
Merced County — 15,275
Stanislaus County — 28,795
San Joaquin County — 38,087
Northern San Joaquin Valley — 82,157
Based on U.S. Census Bureau tallies of housing units, that means nearly 25 percent of Merced County homes were lost to foreclosure, 20 percent of all Stanislaus homes and 21 percent of San Joaquin County homes.
And that doesn't count all the houses that owners were forced to sell at a loss through so-called short sales.
This region's foreclosure crisis was at its worst during July, August and September of 2008. There were 1,639 Merced homes, 2,816 in Stanislaus and 3,862 in San Joaquin foreclosed on during those three brutal months.
That was 10 times higher than the number of foreclosures this April, May and June — 89 in Merced, 232 in Stanislaus and 292 in San Joaquin.
"There are still homes being lost now, but it's because of normal circumstances," said Eduardo Morales, a housing counselor for El Concilio in Modesto.
Traditionally, job loss, medical bills and divorce are the primary reasons for mortgage default.
But this region's foreclosure crisis was different. It was triggered by a housing glut, plummeting home prices, soaring adjustable rate loans, widespread mortgage fraud, repeated refinancing deals that stripped homes of all their equity and an overwhelming number of complicated mortgages made to homeowners who could not logically afford to repay them.
Tricky financing schemes
Morales has been fighting foreclosures and advocating for homeowners for six years. He recalled the crazy loans and tricky financing schemes that got homeowners in mortgage trouble. Fortunately, he said, those problems are mostly over.
These days the recession and job losses still pose problems for some homeowners, but Morales said there are many options to help them now.
During the early years of the foreclosure mess, "banks really were not doing anything" to help homeowners, Morales said. Now many workable loan modifications are being offered, and Morales said his nonprofit, no-fee service often succeeds in saving homes from foreclosure.
Rising home values also are helping.
During the past year, for example, Stanislaus' median home sales price has increased 30 percent. Even though homes still are worth less than half what they were at the 2005 peak of the region's housing boom, the upturn in prices is helping many homeowners get out from under upside-down mortgages.
"It's fairly straightforward to see what's going on. Just do the math," said John Walsh, DataQuick's president. "A foreclosure only makes sense when the home is worth less than what is owed on it. As home values rise, fewer homeowners owe more on their homes than the homes are worth."