Q1 foreclosure rate halved in Denver area; vote in our poll

By John Rebchook, Rocky Mountain News (Contact)

Published April 15, 2008 at 12:05 a.m.

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The rate of increase in foreclosures for the seven-county Denver metro area during the first quarter of 2008 is roughly half what it was a year ago, according to an analysis by the Rocky Mountain News.

There were 7,459 foreclosure filings in the Denver area in the first quarter, about a 16 percent increase from the previous first-quarter record of 6,410 filings in 2007.

"They're still climbing," said Zachary Urban, of Brothers Redevelopment, who oversees the Colorado Foreclosure Hotline, 1-877-601-HOPE. "They have not yet plateaued. It's still an issue."

From the first quarter of 2006 to the first quarter of 2007, the overall foreclosure rate rose by more than 30 percent in Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas and Jefferson counties. In other words, the annual rate of increase through the first quarter of 2008 was nearly halved.

"While no one likes to see these record numbers increase, they're at least going in the right direction," said economist Patty Silverstein, president of Development Research Partners.

She said she expects that trend of falling percentage-rate increases to continue for the rest of the year.

"I think it is possible that by the end of the year we will possibly even show a slight drop from the total number of foreclosures we saw in 2007," Silverstein said.

Many other states are now showing a much bigger increase than Denver and Colorado, Silverstein added.

However, Dan Bloomquist, a broker with RE/MAX Alliance, who has been selling homes in the Denver area for almost 40 years, said he thinks the foreclosure crisis will probably continue through 2010.

"I think 2008 and 2009 will be very tough, and maybe 2010," Bloomquist said. "I think it could roar back in 2011 and 2012."

But Bloomquist said qualified buyers can snap up unbelievable bargains today because of the foreclosure crisis.

"You're seeing homes sell for $80 or $90 per square foot that cost $150 per square foot to build," he said.

rebchookj@RockyMountainNews.com or 303-954-5207

Lending disparities

A higher percentage of Hispanic and black home buyers in the Denver area received risky subprime loans than white borrowers, raising concerns of predatory lending and discriminatory lending practices in Colorado, Gov. Bill Ritter and other officials said Monday.

The Colorado Division of Civil Rights received a $300,000 HUD grant to research the issue and found that while one in five white borrowers received subprime loans, one out of every 2.3 black and one in 2.3 Hispanic borrowers received subprime loans.

• April 15, 2008

  6:01 a.m.

  Suggest removal

  gwats writes:

  The Black & Hispanic borrowers had access to the same info as the White borrowers. Many of them chose the risker product because it was much easier to qualify for and did not require the legwork and extra lifting the fixed product required. Many of these borrowers were warned to stay clear of these bad loans by friends and relatives. they chose not to listen and now the chickens have come home to roost and many of them are living paycheck to paycheck as the loans adjust up.
  They've made so many late payments and have $0 equity, so they cannot refinance due to low credit scores. They often take all month just to put together the current payment + a late charge just to stay afloat.
  It's a vicious cycle that can only end in Foreclosure. The last straw is missing one payment and the whole pile falls in on you. A lot of these borrowers are still flying under the radar because they are not in active foreclosure.
  They will show up on these list if jobs are lost or there is a divorce or an illness which causes missed paychecks.

• April 15, 2008

  8:04 a.m.

  Suggest removal

  Marshdale writes:

  gwats: I'm glad you are so well informed. Because thanks to you I will never make a borrowing mistake. Thats why they call it predatory lending gwats. They prey on the most vulnerable. It would not really matter what your cultural background was. If you are vulnerable the preditors will find you. Your logic does not make sense. As a matter of fact very few people know how to read a HUD sheet and a good faith estimate. So give them a break will ya. Instead of bashing the uninformed, how about doing something to stop predatory lending.

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