Foreclosure rate rising in Phoenix metro area - East Valley Tribune: Business

default avatar
Welcome to the site! Login or Signup below.
Logout|My Dashboard

Foreclosure rate rising in Phoenix metro area

Font Size:
Default font size
Larger font size

Posted: Monday, April 21, 2008 8:10 am

PHOENIX - As housing prices continue to fall in the Phoenix metropolitan area and rates on some mortgage loans rise, experts say more homeowners are walking away from their homes.

The growing trend is pushing up foreclosures and alarming market watchers, particularly in metro Phoenix where home prices have dropped 18 percent in the past year.

Foreclosures across the Phoenix area climbed to a record 2,365 in March, according to the real-estate data firm Information Market. That's more than quadruple the number from a year ago.

"I don't advise people to walk away, but how do you convince someone to keep paying when they owe so much more than their home is worth?," said Brett Barry of the north Phoenix office of Realty Executives. "They can't sell, and their lender isn't going to forgive $100,000 in principal. It's not good."

In the past, homeowners would file for bankruptcy to keep their houses. Now, mortgage delinquencies have climbed faster and higher than late payments on credit-card and car loans.

Economists say that is a sign people are more concerned about their credit than their home.

Homes have gone from being a place to live to a disposable investment for some, said Jay Butler, director of realty studies at Arizona State University's Polytechnic campus.

Neighbors of the people who walk way are already being punished by lower home values due to the foreclosure.

People should hang in there as long as they can, ask for help and try to work with their lender, said Margie O'Campo De Castillo of Arizona Dream Realty.

  • Discuss

'EV Women in Business'

A PDF of the Tribune special section, featuring a mix of sponsored content from our loyal advertisers and newsroom coverage of the East Valley business community.