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Sonoma County foreclosures hit seven-year low (w/video)

  • (WWW.SHUTTERSTOCK.COM)

Foreclosures dropped to their lowest number in more than seven years in Sonoma County as the housing market continues to gain strength.

Local borrowers lost 71 homes in foreclosure proceedings during the first quarter of 2014, down 53.9 percent from the previous year and the lowest number for any quarter since the end of 2006.

Lenders are still dealing with problem loans that were originated eight years ago before the housing bubble burst. But experts said that rising home values and economic growth have helped to reduce the number of foreclosures in California.

"We are way past the worst of the downturn," said Madeline Schnapp, director of economic research for PropertyRadar, a Truckee company that tracks foreclosure and property data.

Foreclosures peaked in Sonoma County in 2008 amid a dramatic plunge in housing prices. That year, homeowners lost a record 2,820 houses and condominiums, compared with 449 last year.

Despite the ongoing drop in foreclosures, the losses have been historic.

Since 2007, Sonoma County has recorded more than 11,000 foreclosures. That amounts to more than one in every 10 homes with a mortgage.

Some of the decline in foreclosures stems from such prevention efforts as short sales and loan modifications. But bigger factors have been an improving economy and increased home values.

At the end of 2013, 12 percent of county homeowners with mortgages were underwater, meaning they owed more on their loans than the homes were worth, according to information service CoreLogic. In contrast, that figure was 32 percent at the end of 2009.

Mortgage defaults have also dropped. In the first quarter of 2014, lenders sent 218 notices of default, the first step in the foreclosure process, down 12.4 percent from a year ago.

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